Four Halts in Two Days: How a 4.39 Yuan Stock Became China’s Wildest IPO

Shengu Group: four trading halts in two days, RMB 4.39 issue price, 245x P/E, 89% turnover

On the afternoon of September 18, the Shanghai Stock Exchange said certain investors in Shengu Group had engaged in abnormal trading that disrupted normal market order. The exchange suspended account trading for those investors under self-regulatory rules. In the same week, the SSE took action against 50 cases of abnormal trading, including ramping and false order submissions, and reported two suspected violations to the China Securities Regulatory Commission.

On the day of the notice, Shengu Group rose nearly 300% intraday, touching RMB 82.59, before closing near RMB 73. Two days earlier, it listed on the SSE main board at RMB 4.39, the lowest A-share IPO price this year.

Day one: institutions sold RMB 151 million; hot money bought RMB 189 million

On September 17, Shengu Group opened at RMB 13.00, up 196.13% from its issue price. Trading was halted twice intraday after gains hit 30% and 60%. The stock closed up 373.80% with a turnover rate of 79.62%. Top-seat trading data showed the top five selling seats were all institutional seats, with net selling of RMB 151 million. The top five buying seats were all brokerage branch seats, with total buying of RMB 189 million.

After the close, the company's market value exceeded RMB 40 billion. Its 2025 net profit attributable to the parent was RMB 739 million.

Day two: gapped down 28%, 89% turnover, two halts

In the September 18 opening auction, Shengu Group gapped down nearly 28%. Funds then pushed the stock higher. In the morning, it triggered its first temporary halt after rising 30% from the opening price. After trading resumed, the gain widened to 60%, triggering a second halt. It hit RMB 82.59 intraday, more than 17 times the issue price. It pulled back near the close and ended up 177.74%. Turnover that day was 89.08%.

An 89.08% turnover rate means nearly 90% of tradable shares changed hands. Most investors who bought the previous day sold the next day. Those who bought on the second day became the new holders.

Valuation: 245x P/E vs. industry average of 41.74x

As of the September 18 close, Shengu Group's static P/E was 242.96x, its TTM P/E was 245.13x, and its P/B was 26.06x. The average static P/E for general equipment manufacturing was 41.74x, with a P/B of 3.50x.

In a post-listing risk warning, the company said its P/E and P/B were well above the industry average, short-term volatility had increased, turnover was high, and a sharp pullback was possible after the rapid rise.

Performance: expected decline in 2026

From 2023 to 2025, Shengu Group's revenue was RMB 8.206 billion, RMB 9.309 billion, and RMB 10.122 billion. Net profit attributable to the parent was RMB 355 million, RMB 442 million, and RMB 739 million. Revenue and profit grew for three straight years.

In the first half of 2026, net profit attributable to the parent fell 2.28% year-on-year. The company expects net profit attributable to the parent from January to September 2026 to fall 8.13% to 23.83% year-on-year, and full-year net profit to fall 10.75% to 15.34%.

Industry position: 51% share, three oil majors as customers

Shengu Group traces its origins to the Shenyang Blower Works, founded in 1952, China's first specialized fan maker. It focuses on major technical equipment such as centrifugal compressors, reciprocating compressors, and nuclear pumps. According to Frost & Sullivan, in 2024 its domestic share of large heavy-duty centrifugal compressors was 51%, ranking first. Its share of process reciprocating compressors was 21.2%. In nuclear pumps, its share of the canned motor main pump segment was 69.2%, also ranking first. Customers include Sinopec, CNPC, CNOOC, and State Power Investment Corporation.

Those facts gave short-term traders a story to sell: high-end equipment, domestic substitution, nuclear power, and SOE reform.

Regulatory space: no price limits in first five days

Under current rules, new stocks have no price limits in their first five days. A 30% gain from the opening price triggers the first temporary halt. A 60% gain triggers the second. Shengu Group's issue price was RMB 4.39, its free float is small, and its themes are concentrated. Those conditions gave short-term funds room to trade.

Regulatory action: suspension of account trading

On September 18, the SSE suspended account trading for certain Shengu Group investors under self-regulatory rules. After that intervention, a short-term rally driven by sentiment and funds faces policy risk. If regulators tighten further, speculative sentiment may recede.

At the September 18 close, Shengu Group traded at RMB 73, with a TTM P/E of 245.13x and turnover of 89.08%.