To The Moon

Lancy Co., Ltd. (SZSE: 002612) announced in an evening filing that its qualification as a high-tech enterprise for the years 2023 to 2025 has been revoked.

The company stated that the specific impact on its operational performance from the loss of this status requires further clarification from tax authorities, with final details to be provided in subsequent disclosures.

According to the announcement, relevant authorities in Beijing, including the Beijing Municipal Science & Technology Commission and the Beijing Municipal Taxation Bureau, issued a notice on June 25, 2026. Based on national regulations for high-tech enterprise certification, the qualification was rescinded for several companies, including Lancy Co., Ltd. and Beijing Saiwei Electronics Co., Ltd.

In its annual reports for 2023, 2024, and 2025, Lancy had noted that it held a high-tech enterprise certificate issued in October 2023, which allowed it to apply a preferential corporate income tax rate of 15% for those three years, as opposed to the standard statutory rate.

While the immediate financial impact is pending official assessment, precedent cases suggest two primary consequences. First, the corporate income tax rate would revert from 15% to the standard 25%, and tax authorities would likely recover the tax benefits enjoyed since the year the company no longer met the certification criteria. Second, the company may face late payment penalties.

For instance, in December 2024, another listed company, Shanghai MicroPort Endovascular MedTech Co., Ltd., announced it had to repay tax benefits and pay penalties after its high-tech status was revoked.

Beyond the direct tax implications, the loss of this status carries broader operational and capital market risks. The high-tech qualification is a prerequisite for applying for various policy-supported loans, grants, and industry-specific projects. Its absence could hinder the company's access to such funding and support in the near term.

In capital markets, the high-tech designation is a key metric used by investors to gauge a company's research and development strength and innovation potential. The revocation could weaken institutional investor confidence in the company's growth prospects and potentially increase stock price volatility.

Lancy Co.,Ltd. operates across three main business segments: fashion women's apparel, medical aesthetics, and green baby & children's products. Financial reports show the company generated revenues of 5.145 billion yuan, 5.691 billion yuan, and 6.003 billion yuan in 2023, 2024, and 2025, respectively. Net profits attributable to shareholders were 225 million yuan, 257 million yuan, and 999 million yuan for those same years.

The company's share price has been on a downward trend throughout the current year.