Zhongce Rubber Group Co Ltd

Entering October, the fourth round of concentrated price hikes in China's tire industry this year has officially entered its implementation period. Leading tire companies including General Science Technology, Zhongce Rubber, Sailun Tire, and Linglong Tire have raised prices by 2% to 5% across all product categories such as all-steel tires, semi-steel tires, and off-the-road tires. This is already the fourth round of concentrated price-increase notices issued by the tire industry since March this year. In its price adjustment notice, General Science Technology pointed to raw materials as the reason for the increase, saying that prices of natural rubber, synthetic rubber, and carbon black have continued to rise sharply, causing tire manufacturing costs to climb rapidly. Raw materials account for more than 70% of tire production costs, with natural rubber, synthetic rubber, and carbon black together accounting for more than 60%. The simultaneous rise of these three major raw materials is the fundamental driver of this round of price increases. On carbon black, data from SunSirs shows that on October 1, the benchmark price of carbon black was reported at 11,692.86 yuan per ton, up about 59.74% year on year. On natural rubber, as of the end of the third quarter, the main Shanghai rubber futures contract closed above the 20,000 yuan per ton mark, while the average spot price in the domestic market over the same period was about 19,400 yuan per ton, up 31% year on year. On synthetic rubber, according to SunSirs data from October 1, the benchmark price of butadiene rubber was reported at 16,220 yuan per ton, up 39% year on year, and the benchmark price of styrene-butadiene rubber was reported at 16,175 yuan per ton, up about 36% year on year. According to data from Longzhong Information, as of September 29, the raw material cost index for semi-steel tires and the raw material cost index for all-steel tires both rose about 25% year on year. Zhongtai Securities believes that after cost disturbances ease, leading tire companies are expected to return to high year-on-year growth, but industry divergence will further intensify.

Zhongce Rubber announced in a voluntary disclosure after market close on September 10 that its 245/55R19PR ARISUN 1 Star 107V tire product has been selected as the original equipment tire for Xiaomi Auto's Pengcheng N70 model, which was recently launched. As of the announcement date, the company's cumulative shipment value for this model was approximately 3.8 million yuan, accounting for 0.0085 percent of its 2025 annual sales revenue. Zhongce Rubber stated that this supply arrangement reflects the customer's recognition of the company's research and development capabilities, product quality, and response systems, but the subsequent manufacturing and sales volume of this model remains uncertain, and actual supply volume is subject to uncertainty. The company expects that this single supply project will not have a material impact on its operating results for this year or future years. Zhongce Rubber is a leading player in China's tire industry. In the first half of 2026, it achieved operating revenue of 23.474 billion yuan, up 7.41 percent year on year. The company previously broke through in the mid-to-high-end mainstream vehicle segment for domestic tires through cooperation with HarmonyOS Intelligent Mobility and by supplying tires for the Aito M6 model.

B.Grimm Power (BGRIM) has announced a major reorganization of its business units to support the new Power Development Plan (PDP 2026) and move towards becoming an Energy Tech Company. Mr. Noppadol Karnasuta, Chief Executive Officer for businesses in Thailand, Malaysia, and Industrial Business Solutions, revealed that the company has established 4 main business units: B.Grimm BeyondBridge, aiming for Digital Infrastructure-as-a-Service; B.Grimm iNet, upgrading industrial estates to Smart Industrial Estates; Digital Edge B.Grimm, a developer of Hyperscale Data Centers with a capacity of 96 megawatts and a value of 26 billion baht in Chonburi Province, which is over 45% complete and is preparing for partial operation by the end of 2026; and a regional clean energy portfolio under the GreenLeap strategy, targeting 10,000 megawatts of contracted capacity with over 50% renewable energy share by 2027. The company also has opportunities for short-term revenue from 250 megawatts of generation capacity ready for immediate connection, the Data Center Ecosystem deal, and the Nakwol 1 project in South Korea with a capacity of 365 megawatts, in which it holds a 49% stake, expected to commence commercial operation within this year. Other projects are also gradually reaching COD, such as Zhongce Rubber with 35 megawatts and Huong Hoa 1 with 48 megawatts. Meanwhile, the company is preparing for SMR technology through cooperation with European and Chinese partners to reduce long-term dependence on fuel imports.

Zhongce Rubber announced that its project, Key Technologies for High-Performance Tires and Green Intelligent Manufacturing, has won the second prize at the 2025 National Science and Technology Progress Award. The project focuses on innovations in overall tire manufacturing technology and key materials, achieving comprehensive performance improvements in tire products and energy savings in production, with overall technology reaching internationally advanced levels. This award will help enhance the company's brand influence but has no significant impact on short-term earnings.