Hongda Electronics has released a statement addressing the abnormal fluctuations observed in its stock trading activities. The announcement revealed that Jiangsu Zhanxin Semiconductor Technology Co., Ltd. (hereinafter referred to as "Jiangsu Zhanxin"), a company in which Hongda Electronics indirectly holds a 13.79% equity stake, has officially filed an application with the Shenzhen Stock Exchange for an Initial Public Offering (IPO) and subsequent listing on the ChiNext board—a platform dedicated to nurturing innovative and high-growth enterprises. This application was officially accepted, with the disclosure of this development taking place on December 18.

It is crucial to note that, both prior to and following the acceptance of Jiangsu Zhanxin's IPO application, there have been no material alterations in Hongda Electronics' shareholding proportion or voting power within Jiangsu Zhanxin. Consequently, Hongda Electronics continues to account for this investment utilizing the equity method, a standard accounting practice for significant influences over investees. The company anticipates that the IPO application and its potential outcomes will not exert a substantial impact on its current financial statements.

However, it is important to underscore that the future trajectory and progress of Jiangsu Zhanxin's IPO application remain shrouded in uncertainty, subject to various regulatory, market, and operational factors.