NewTimeSpace | Plunging nearly 25% in 5 trading days, Hongxing Coldchain (01641.HK) encounters a fiasco at its market debut

Since its debut on the Hong Kong Stock Exchange on January 13, 2026, the K-line of this Hunan cold chain giant has yet to see a green (positive) day.

NewTimeSpace learned that on its first day of trading on the Hong Kong Stock Exchange, Hongxing Coldchain (01641.HK) opened with a surge of 59.71% at HK$19.58 during the pre-opening auction, with a total market capitalization reaching HK$1.4685 billion. However, this high opening price was only a flash in the pan and did not last long, followed by a sharp plunge and subsequent continuous decline in the company's stock price.

**Five consecutive days of sharp decline, stock price falls below issue price**

Public information shows that Hongxing Coldchain is a provider of frozen food warehousing services and frozen food store rental services, headquartered in Changsha, Hunan Province. For frozen food warehousing services, the company provides services such as goods sorting, classification and packaging, inventory counting and tracking, inbound and outbound records, etc., with customers paying frozen food warehousing service fees.

For this IPO, Hongxing Coldchain offered 23.263 million shares globally, of which 2.3265 million shares were offered in Hong Kong's public offering, with the issue price set at HK$12.26 per share. After deducting relevant expenses, the net proceeds were approximately HK$252 million.

In the subscription market, Hongxing Coldchain was sought after by Hong Kong local investors. The allotment results showed that the company's Hong Kong public offering received subscriptions as high as 2,309.25 times oversubscribed, while the international offering achieved 1.65 times oversubscription. There were 98,005 valid applications in Group A, with a total of 2,327 applicants accepted.

However, the reality on the listing day disappointed many investors.

NewTimeSpace learned that Hongxing Coldchain's gray market rose 36% the day before listing. Although the stock opened nearly 60% higher on the first day, the final closing gain was only 0.33%. While the stock price rebounded nearly 5% on the second day, the subsequent price trend was unbelievable.

Data shows that Hongxing Coldchain, starting from the third trading day after listing, that is, in the 5 trading days from January 15, 2026 to January 21, 2026, fell sharply for five consecutive days, with an interval decline of 24.88%.

On January 21, 2026, Hongxing Coldchain closed at HK$9.24 per share, with a daily decline of 7.23%, having fallen below the issue price.

**Declining profitability, cumulative dividends of RMB 240 million before listing**

According to a CIC report, in the frozen food warehousing service market, by revenue in 2024, Hongxing Coldchain is the largest frozen food warehousing service provider in central China and Hunan Province, with market shares of 2.6% and 13.6% respectively in central China and Hunan Province, and 0.7% market share in China.

Despite being crowned as a regional leader, Hongxing Coldchain's financial performance has been unstable.

The prospectus shows that from 2022 to 2024, the company's revenue was RMB 237 million, RMB 202 million, and RMB 234 million respectively, with volatile earnings and a negative compound annual growth rate.

In the first half of 2025, the company experienced a situation of "increasing revenue without increasing profit." First-half revenue was RMB 118 million, up 5.4% year-over-year, but profit during the period fell from RMB 41.27 million in the same period last year to RMB 39.68 million, a decrease of 3.9%.

Despite facing declining profitability, Hongxing Coldchain's dividend behavior before listing has attracted widespread market attention.

According to NewTimeSpace, from 2022 to the first half of 2025, Hongxing Coldchain's cumulative dividends amounted to as much as RMB 240 million. Among them, dividends in 2024 were RMB 140 million, exceeding the net profit of RMB 82.88 million for that year; dividends in the first half of 2025 were RMB 40 million, also exceeding the net profit of RMB 39.683 million for the same period.

Since the controlling shareholder holds a combined stake of over 70%, the vast majority of the huge dividends also flow into the hands of major shareholders. The generous dividend distribution before listing has triggered market discussion about its "dividend first, financing later" business strategy.

In addition, it is understood that behind Hongxing Coldchain's generous dividends, there is a situation of arrears in employee social insurance and housing provident fund payments. As of the end of the first half of 2025, the cumulative arrears amount to approximately RMB 16.8 million.

Hongxing Coldchain stated in its prospectus that the main reasons are the negligence of responsible personnel and a lack of comprehensive understanding of relevant local regulations.

**Declining base storage fees and renewal rates, competitors enter in force**

The decline in Hongxing Coldchain's profitability in recent years reflects the company's operational difficulties.

The prospectus shows that Hongxing Coldchain's self-operated food cold storage in Changsha provides two bases for frozen food wholesalers and retailers, with a total designed capacity of over one million cubic meters, equivalent to usable capacity of over 230,000 tons. Among them, the southern base has a capacity of approximately 206,600 tons, while the northern base has only 24,000 tons, with capacity utilization rates of 88.2% and 45.9% respectively, and warehousing customer counts of 734 and 23 respectively.

It is worth noting that the number of customers at Hongxing Coldchain's Changsha northern base plummeted from 279 in 2022 to only 23 in the first half of 2025, a drop of as much as 91.76%. At the same time, the base's capacity utilization rate also fell sharply from 85% to 45.9%.

Meanwhile, the renewal rate of the southern base declined from 97.9% to 90.6%, while that of the northern base was only about 30%. Moreover, due to continued declines in capacity utilization and renewal rates, its northern base remains in a net loss state, achieving net profits of only RMB 3 million and RMB 1 million in 2022 and 2024 respectively.

In addition, since 2025, the average storage fee per ton at Hongxing Coldchain's warehousing bases has also shown a downward trend. Specifically, the average storage fee per ton at the southern base decreased from RMB 73.4/ton at the end of January to RMB 69.6/ton at the end of June, while that at the northern base decreased from RMB 60.6 to RMB 58.9/ton.

Currently, Hongxing Coldchain's revenue is heavily dependent on the southern warehousing base, while the decline in capacity utilization and renewal rates at the northern base continues. Whether it can reverse the loss-making situation after listing remains unknown.

However, Hongxing Coldchain's IPO plan allocates approximately 57.5% of the raised funds to building new processing plants and expanding frozen food warehousing facilities. Given the current unsaturated warehousing operations, the post-expansion operations will also raise market concerns.

NewTimeSpace learned that Yuhu Coldchain, a subsidiary of Hong Kong Yuhu Group, has now entered the Changsha market. Information shows that Yuhu Coldchain (Changsha) Trading Center is expected to be officially operational in 2026. The park covers an area of approximately 400 acres, with a construction area of over 360,000 square meters, and a park capacity of over 280,000 tons. After completion, it is expected to introduce over 700 enterprises.

By comparison, the capacity of this brand-new Yuhu Coldchain Changsha cold chain trading center has exceeded the combined capacity of Hongxing Coldchain's two cold storage facilities. As a regional leader, Hongxing Coldchain must face pressure from existing competitors while also welcoming challenges from new entrants.

It is not difficult to foresee that Hongxing Coldchain will face considerable challenges in its future operations.

NewTimeSpace Disclaimer: All content herein is the original work of NewTimeSpace. Any reproduction, reprinting, or use of this content in any other manner must clearly indicate the source as "NewTimeSpace". NewTimeSpace and its authorized third-party information providers strive to ensure the accuracy and reliability of the data, but do not guarantee the absolute correctness thereof. This content is for reference only and does not constitute any investment advice. All transaction risks shall be borne by the user.