For years, Annoqi Group was a standard bearer in China’s traditional industrial sector, specializing in the chemically intensive world of dyes. However, the company is now making a radical bet on the future of digital infrastructure. Faced with a catastrophic 800% widening of annual losses in its core chemical business, the company recently announced a major asset restructuring to acquire Guangzhou Fengyun, an artificial intelligence and computing power service provider. This move marks a desperate but calculated pivot from the stagnant margins of manufacturing to the high-growth potential of the AI-driven 'computing power' (suanli) economy.
The financial reality for Annoqi has been increasingly grim. According to the company's latest performance estimates, net losses for 2025 are projected to reach between 46 million and 65 million RMB, a staggering jump from the modest 4.75 million RMB loss recorded in the prior year. Management has attributed this 'internal bleeding' to rising fixed costs from new projects and intense price competition aimed at maintaining market share. In this context, the acquisition of a tech asset that generates over 1 billion RMB in annual revenue is not merely an expansion—it is a lifeline intended to rewrite the company’s investment narrative.
Guangzhou Fengyun, the acquisition target, operates at the intersection of data centers and edge computing. Its growth trajectory has been notable, with revenues climbing from 470 million RMB in 2021 to a projected 1 billion RMB by 2025. While its net profit remains relatively thin compared to its massive top-line growth, the asset provides Annoqi with an immediate foothold in the GPU rental and computing power leasing markets. This sector has become a focal point for Chinese investors as local firms scramble to secure hardware and processing capabilities amidst global chip supply constraints and a domestic AI boom.
This is not Annoqi’s first foray into the tech space. The company previously acquired Shanghai Gencong Technology to seed its computing power operations, suggesting a phased exit from its legacy industrial roots. The current deal, involving a mix of share issuance and cash payments, has led to a temporary suspension of Annoqi’s stock trading. As the company prepares its final disclosure, the market is watching closely to see if a traditional chemical manufacturer can successfully navigate the complexities of high-tech infrastructure management or if this is another case of 'cross-border' overreach common in China’s volatile capital markets.