Xingyu Co., Ltd. Plans to Use 4.5 Billion Yuan in Self-Owned Funds for Cash Management to Enhance Returns on Idle Funds

On March 20, Changzhou Xingyu Automotive Lighting Co., Ltd. (Stock abbreviation: Xingyu Co., Ltd., Stock code: 601799) announced that the company plans to use no more than 4.5 billion yuan of its own funds for cash management, investing in safe, highly liquid, principal-protected or low- to medium-risk financial products to improve the efficiency of idle funds. The proposal has been approved by the board of directors and is subject to review at the company’s 2025 annual general meeting.

According to the announcement, the funds for this cash management come from the company’s and its subsidiaries’ own funds. The investment period is within 12 months from the date of approval by the shareholders’ meeting, and the amount can be rolled over within the validity period. Investment options include negotiated deposits, structured deposits, fixed-term deposits, large-denomination certificates of deposit, notice deposits, bank financial products, and brokerage financial products.

Key Elements of the Cash Management Plan

The announcement states that the main purpose of the company’s cash management is to enhance returns by reasonably allocating idle funds without affecting the normal operational capital needs. Xingyu Co., Ltd. emphasizes that this investment will not impact the company’s main business operations. Currently, the company’s financial condition is stable, and the use of funds will strictly prioritize safety and liquidity.

Regarding risk control, the company has implemented multiple measures: the finance department will select suitable targets based on fund status and product risk-return characteristics for approval by the general manager; dedicated personnel will track the progress of investment projects and take protective measures if risks are identified; a ledger will be established for management and financial accounting, with internal audit supervising fund use and safekeeping; independent directors and the audit committee have the right to supervise and inspect fund usage, and professional agencies may be hired for audits if necessary.

The announcement also notes that although the investment products are low- to medium-risk, their yields are subject to market fluctuations, interest rate changes, policy adjustments, and force majeure, so actual returns may differ from expectations.

According to accounting standards, the financial products purchased by the company will be classified as financial assets measured at fair value with changes recognized in current profit and loss, in accordance with the “Enterprise Accounting Standard No. 22 - Recognition and Measurement of Financial Instruments.”

Xingyu Co., Ltd. states that this cash management will help improve the efficiency of using its own funds and increase returns on cash assets, aligning with the interests of the company and all shareholders. The company will conduct related investments in a timely manner based on the shareholders’ approval and market conditions.

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