Analysis of Leo Group's Fund Freezing Incident

Based on the collected information, I will provide a detailed analysis of Leo Group’s fund freezing incident and its operational impact for you.

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According to public information, Leo Group (Stock Code: 002131.SZ) is involved in a litigation case, which resulted in approximately

[1]. This freezing is related to the litigation and escrow procedures[1]. As of the first half of 2025, the company’s total assets were approximately [1].

Indicator	Value	Proportion
Frozen Funds	RMB 1.07 million	-
Company Total Assets	RMB 2.78 billion	0.038%
Proportion of Frozen Funds to Total Assets	-	Less than 0.04%

Based on the company’s recent financial and operational data[0]:

• Ample Liquidity
  : The current ratio is 2.41, and the quick ratio is 2.29, indicating strong short-term solvency of the company
• Low Debt Risk
  : Financial analysis shows the debt risk rating is “Low Risk”[0]
• Stable Operations
  : The company’s main business covers two sectors: machinery manufacturing and digital marketing, with revenue reaching USD 4.82 billion in the third quarter of 2025[0]

Notably, despite the fund freezing incident, the company’s stock price has performed quite strongly[0]:

Period	Increase
1 Month	+108.84%
6 Months	+181.84%
1 Year	+173.68%

On January 13, 2026, the company’s stock hit the daily trading limit at RMB 8.21 per share, with a total market value reaching RMB 61.149 billion. The market reacted muted to the fund freezing incident, indicating that investors believe the impact of this matter is limited.

Although the current impact is limited, the following risk factors still require attention:

1. Uncertainty in Litigation Progress
   : The outcome of the litigation is still uncertain, which may involve additional compensation liabilities
2. Aggressive Accounting Policies
   : The company adopts aggressive accounting policies (low depreciation/capital expenditure ratio), which may affect earnings quality[0]
3. Negative Free Cash Flow
   : The latest data shows that free cash flow is -RMB 467 million[0], requiring attention to cash flow management

1. Amount Perspective
   : The frozen funds of RMB 1.07 million account for an extremely low proportion (<0.04%) relative to the company’s total assets of RMB 2.78 billion
2. Liquidity Perspective
   : The company’s current ratio of 2.41 shows ample short-term liquidity, which is sufficient to cope with the situation
3. Market Perspective
   : The continuous rise in stock price indicates that the market is optimistic about the impact of this incident
4. Business Perspective
   : The main business operations have not been significantly affected

: Investors can maintain attention to the company, focusing on tracking the progress of the litigation and the 2025 annual report data. With the support of current hot concepts such as AI marketing and digital marketing, the company’s fundamentals remain sound.

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[1] Eastmoney.com - Leo Group Financial Data and Fund Freezing Statement (https://gbres.dfcfw.com/Files/iimage/20260118/07B0511B3A5F3392D6693F8F0AA276C7_w1380h508.jpg)

[0] Jinling API Financial Database - Leo Group Company Profile, Financial Analysis and Stock Price Data