The craziest new stock: Shengu Group has witnessed a sharp surge, a flash crash and regulatory interventions all within just three days after its listing.

Having been listed on the A-share market for only three trading days, Shengu Group has become the most high-profile "miracle stock" in the market amid drastic swings in its share price.

On September 21, the share price of Shengu Group plunged 48.07% at the opening, then rebounded partially later, triggering two intraday trading halts during the session. By the close, the company's share price fell 34.71% to 37.72 yuan per share, with a total market capitalization of about 117.3 billion yuan.

Prior to this sharp pullback, Shengu Group had just seen a steep rally for two consecutive trading days.

Shengu Group was listed on the main board of the Shanghai Stock Exchange on September 17 at an issue price of 4.39 yuan per share, recording a 373.81% increase on its first trading day. On the second day of listing, the company's share price moved higher after a low opening, once hitting a high of 82.59 yuan per share, nearly 18 times higher than the issue price; by the close, the share price retreated to 57.77 yuan per share, notching a further 177.74% gain on the single day.

Within just two trading days, Shengu Group triggered four intraday trading halts. In terms of market value, the company's market cap once peaked at 250 billion yuan on the second listing day, making it the most valuable listed company in the three provinces of Northeast China for a time.

Looking at this year's A-share new share market, a total of 116 new shares have been listed, all closing higher on their first trading day. However, stocks that saw such a steep surge for two consecutive trading days as Shengu Group are extremely rare.

Facing the abnormal fluctuations in share price, both the listed company and the stock exchange have taken actions.

On the evening of September 18, Shengu Group issued a stock trading risk warning announcement, which was also the first announcement released after the company's listing. Shengu Group stated that the share price increase in the two trading days after its listing significantly deviated from the level of the same industry. On September 18, its static price-to-earnings ratio and price-to-book ratio stood at 242.96 times and 26.06 times respectively, far higher than the industry average, meaning the company's share price faces the risk of a sharp pullback after the rapid rally.

On the same evening, the Shanghai Stock Exchange released a statement saying that since Shengu Group's listing, its share price has fluctuated drastically, and some investors have engaged in abnormal trading behaviors that disrupt the normal order of stock trading when trading the stock. The Shanghai Stock Exchange has taken self-regulatory measures including suspending account trading for relevant investors in accordance with regulations.

After the sharp fall on September 21, the Shanghai Stock Exchange issued another notice stating that it will continue to pay close attention to the trading of this stock in the early stage after listing and take self-regulatory measures in accordance with regulations.

From the new share with the lowest issue price of the year to the "miracle stock" that triggered six trading halts in three trading days and was specially named by the exchange, the sharp ups and downs of Shengu Group's share price are driven by the speculation of secondary market funds, as well as the scarcity of the company's main business.

Behind the drastic ups and downs of the "miracle stock"

The sharp rally of Shengu Group's share price in the first two trading days after listing is the result of multiple intertwined factors.

First of all, the cost of participating in the trading of Shengu Group's stock is relatively low. The company's issue price is 4.39 yuan per share, the lowest among new shares issued this year. Its opening price on the first listing day was only 13 yuan per share. If investors buy one lot (100 shares) at the opening, the required capital is only about 1300 yuan, which is relatively low.

Meanwhile, Shengu Group is listed on the main board of the Shanghai Stock Exchange, so the threshold for investors to participate in trading is not high, and the group of investors eligible to trade this stock is larger. In contrast, trading stocks on the ChiNext, Sci-Tech Innovation Board, and Beijing Stock Exchange requires meeting capital and trading experience thresholds, which excludes many investors with insufficient capital and trading history.

Second, the total share capital of Shengu Group after this listing is about 3.11 billion shares, but the total number of tradable shares is only about 211 million shares, accounting for only 6.79%. Calculated at the issue price, the total market value of tradable shares is only about 927 million yuan, and it is only 2.745 billion yuan even calculated at the opening price on the first listing day. The small size of the tradable share float means that only a small amount of capital can significantly drive the rise and fall of the share price.

On September 17, 18 and 21, the trading volume of Shengu Group's stock was 168 million shares, 188 million shares and 157 million shares respectively, with turnover rates of 79.62%, 89.08% and 74.14% respectively. With a small tradable share float, chips can circulate rapidly, leading to drastic fluctuations in the company's share price amid the circulation.

In addition, according to the Trading Rules of the Shanghai Stock Exchange, there is no limit on the price fluctuation of new stocks on the main board in the first 5 trading days after listing, and the 10% price fluctuation limit will be restored from the 6th trading day. Against the backdrop of hot market trading sentiment and deliberate "speculation" by some funds, Shengu Group's share price rose rapidly in the first two trading days.

As the Shanghai Stock Exchange moved to suspend the trading of some abnormal accounts, the fluctuation range of Shengu Group narrowed significantly on the third trading day, and its share price also pulled back to some extent.

Pre-listing shareholders share the capital feast

With the sharp rise of Shengu Group's share price, the shares held by the company's pre-listing shareholders have generated large amounts of floating profits.

The history of Shengu Group can be traced back to 1934. After the founding of the People's Republic of China, the company was renamed Shenyang Blower Works, becoming one of the important heavy industrial factories in Northeast China. In 2003, the company completed the overall restructuring and became a corporate state-owned enterprise, and completed the shareholding system reform in 2010.

At present, the controlling shareholder of Shengu Group is the State-owned Assets Company of Tiexi District, and the actual controller is the State-owned Assets Administration Bureau of Tiexi District, Shenyang. After listing, the State-owned Assets Company of Tiexi District holds a total of 1.205 billion shares of Shengu Group, accounting for 38.76% of the total share capital. At the share price peak on September 18, the market value of its holdings once approached 100 billion yuan, and by the close of September 21, the market value of its holdings still reached 45.5 billion yuan.

In addition to the State-owned Assets Company of Tiexi District, there are many other shareholders with state-owned capital background behind Shengu Group.

In 2022, Shengu Group launched a capital increase and share expansion, introducing the Advanced Manufacturing Industry Investment Fund Phase II (hereinafter referred to as "Advanced Manufacturing Fund") as an investor. The fund invested 1.894 billion yuan to obtain 1.07 billion shares of Shengu Group at a consideration of about 1.77 yuan per share. The Advanced Manufacturing Fund has also become the second largest shareholder of Shengu Group, with a current shareholding ratio of 34.41%.

With the listing of Shengu Group, the shares held by the Advanced Manufacturing Fund have reaped large floating profits. Calculated at the closing price on September 21, the market value of the fund's holdings is about 40.363 billion yuan, with a floating profit of more than 20 times compared with the entry price, and the total floating profit exceeds 38 billion yuan.

In addition, Shengu Group also has many state-owned shareholders including China Cinda, China Great Wall Asset Management, Yankuang Capital, CASIC Investment, and CSSC Investment. With the sharp rise of the company's share price after listing, these shareholders have also gained floating profits.

Some employees of Shengu Group also share this round of capital feast of the company.

As early as 2011, Shengu Group began to promote employee shareholding. At that time, 136 core enterprise members, key technical and management personnel including Su Yongqiang participated in the company's capital increase at a price of 3.55 yuan per share, obtaining 66.91 million shares.

In 2022 and 2023, Shengu Group implemented two phases of employee stock ownership plans, holding the company's shares through the employee shareholding platform Shenyang Haochen. Among them, the first-phase shareholding plan obtained 79.28 million shares of the company through capital increase via Shenyang Haochen at a consideration of 1.77 yuan per share; the second-phase shareholding plan saw Shenyang Haochen transfer 110 million shares at a consideration of 1.954 yuan per share.

At present, Shenyang Haochen holds a total of 189 million shares of Shengu Group, accounting for 6.09% of the total share capital. Calculated at the latest share price, the corresponding market value is about 7.144 billion yuan. The cost of this shareholding platform is about 355 million yuan, and the current price is about 19 times higher than the cost price in terms of floating profit.

Performance changes after listing

Shengu Group is a well-known domestic equipment manufacturer, mainly producing major technical equipment products such as centrifugal compressors, reciprocating compressors and nuclear pumps, with downstream customers mainly distributed in the petroleum, chemical, natural gas and nuclear power plant sectors.

In recent years, the overall performance of Shengu Group has maintained a growth trend. From 2023 to 2025, the company's operating revenue was 8.206 billion yuan, 9.309 billion yuan and 10.122 billion yuan respectively; the net profit attributable to shareholders was 355 million yuan, 442 million yuan and 739 million yuan respectively.

However, in 2026, the growth rate of Shengu Group's operating revenue began to slow down, and the net profit even declined year on year. In the first half of this year, the company's operating revenue reached 4.893 billion yuan, up 3.60% year on year, with the growth rate lower than that in the same period of 2025; the net profit attributable to shareholders was 280 million yuan, down 2.28% year on year. According to the company's forecast, the annual operating revenue growth rate in 2026 may reach 9.66%-12.62%, but the net profit attributable to shareholders will decline by 10.75%-15.34% year on year.

Shengu Group stated that its downstream energy and chemical industry is a capital-intensive industry with a long project construction cycle, so there will be certain fluctuations in operating performance when compared on a quarterly basis. In addition, the scale and pace of fixed asset investment are affected by factors such as the macroeconomic cycle, energy industry policies, geopolitics, and commodity price fluctuations, presenting certain cyclical fluctuation characteristics. Therefore, the company faces certain uncertainties in maintaining steady growth in operating performance in the future, with the risk of performance decline.

In addition, as a heavy equipment manufacturer, Shengu Group also faces a prominent problem of capital occupation by downstream customers.

At the end of 2025, the book value of Shengu Group's accounts receivable was 3.362 billion yuan, accounting for about 13.92% of current assets. In the same period, the amount of overdue accounts receivable of the company was 2.708 billion yuan, accounting for about 61.41% of the balance of accounts receivable.

From the perspective of Shengu Group, although its customers are mainly large and medium-sized domestic enterprises with good overall credit records, once the customers face deteriorating capital status or declining credit standing, the company may face the risk of bad debt losses on accounts receivable or insufficient provision for bad debt reserves.

This article is from the WeChat official account "Damofinance" (ID: damofinance), Author: Damofinance, published with authorization by 36Kr.