Hefu China (603122.SH) Popular Drivers and Risk Analysis

Hefu China (603122.SH) became popular in the market mainly due to

1. Abnormal Stock Price Triggers Attention
   : From October 28 to December 18, 2025, the company’s stock price increased by 349.25% cumulatively, and it corrected sharply by about 16% on December 19, closing at 25.09 yuan. The fluctuation range triggered extensive market discussions [0][1][2][3].
2. Company Risk Warnings Enhance Popularity
   : On December 18 and 19, the company issued consecutive announcements, clearly stating that the stock price was “seriously deviating from fundamentals” and there was a risk of bubbling, which further increased market attention [2][3][4].
3. Extreme Misalignment Between Fundamentals and Stock Price
   : In Q3 2025, the company’s net profit was -5.0479 million yuan, a year-on-year decrease of 225.26%, and it was in a loss state, while the stock price continued to surge during the same period, with a significant degree of divergence [2][3][4].
4. High Speculative Characteristics on the Technical Side
   : On December 18, the turnover rate reached 21.53%, indicating active short-term speculative transactions in the market, which intensified stock price fluctuations [2][3].

1. Speculation-Dominated Market Nature
   : The stock price rise was not supported by any major business changes, and was completely driven by market sentiment, showing typical “pass the parcel” characteristics [2][3][4].
2. Signal Significance of Risk Warnings
   : The company’s consecutive announcements reflect the management’s clear concern about the stock price bubble, which is an important early warning signal that the stock price may continue to correct in the future [2][3][4].
3. Industry Comparison Highlights Valuation Bubble
   : The company’s price-to-earnings ratio is significantly higher than the industry average, and the valuation has seriously overdrawn future performance growth space [2][3][4].

• Fundamental Risk
  : The company’s business has not seen substantial improvement, and consecutive losses indicate insufficient profitability, which cannot support the current stock price [2][3][4].
• Overvaluation Risk
  : The stock price is seriously disconnected from fundamentals, with obvious bubbling characteristics, and a sharp correction may occur at any time [2][3][4].
• Share Reduction Risk
  : The controlling shareholder Hefu (Hong Kong) Holdings Limited has a share reduction plan, which may further suppress the stock price [2][3][4].
• Policy and Market Risks
  : The regulatory authorities’ attention to abnormal stock price fluctuations and the reversal of market sentiment may both intensify the downward pressure on the stock price [0][2][3].

No clear investment opportunities related to the company’s fundamentals have been found so far, and the market is completely driven by short-term speculative factors.

Hefu China (603122.SH) became popular in the market due to short-term stock price surge, risk warnings, and sharp corrections. However, from the analysis, its stock price increase lacks fundamental support, has prominent speculation, and faces multiple risks. Investors should fully assess the risk level, avoid blindly chasing short-term fluctuations, and dynamically adjust decisions based on changes in the company’s fundamentals and market sentiment.