--- title: "HK IPO: Shougang Langze Listing Analysis and Subscription Plan" type: "Topics" locale: "en" url: "https://longbridge.com/en/topics/31367510.md" description: "Shougang Langze is a high-tech environmental protection company that utilizes unique biological fermentation technology to convert harmful exhaust gases (mainly carbon monoxide and carbon dioxide) emitted by factories into fuel alcohol and high-protein feed. According to Frost & Sullivan data, the company is the first in China's CCUS (Carbon Capture, Utilization, and Storage) industry to achieve commercial and large-scale production of low-carbon products through synthetic biotechnology. Shougang Langze has pioneered multiple industrial application breakthroughs: the world's first to utilize carbon-containing industrial tail gas from steel/ferroalloy plants..." datetime: "2025-07-01T15:34:46.000Z" locales: - [en](https://longbridge.com/en/topics/31367510.md) - [zh-CN](https://longbridge.com/zh-CN/topics/31367510.md) - [zh-HK](https://longbridge.com/zh-HK/topics/31367510.md) author: "[龙龟投资](https://longbridge.com/en/profiles/5098.md)" --- # HK IPO: Shougang Langze Listing Analysis and Subscription Plan **Shougang Langze is a high-tech environmental company that utilizes unique bio-fermentation technology to convert harmful exhaust gases (mainly carbon monoxide and carbon dioxide) emitted by factories into fuel ethanol and high-protein feed.** According to Frost & Sullivan data, the company is **the first enterprise in China's CCUS (Carbon Capture, Utilization, and Storage) industry to achieve commercialized and large-scale production of low-carbon products through synthetic biotechnology**. Shougang Langze has pioneered multiple industrial application breakthroughs: **World's first** industrial-scale facility to produce ethanol and microbial protein from carbon-containing industrial tail gas of steel/ferroalloy plants via bio-fermentation; Independently developed **second-generation negative carbon technology**, directly converting CO₂, CO, and H₂ into ethanol and microbial protein. As of the latest practicable date, the company has successfully operated **4 large-scale production facilities** in China, verifying the feasibility of industrial replication of core technologies and setting an industry benchmark. ![Image](https://pub.pbkrs.com/uploads/2025/aa3431af44cbb95a0389e95d2d42737c?x-oss-process=style/lg) The proceeds from this global offering are **primarily allocated to capacity expansion (SAF facilities + Hebei Phase II, accounting for 59.1%), technology enhancement (R&D + upgrades, 25.5%), and operational support (new products + working capital, 15.4%).** **What are the company's issuance details and lottery rate?** ![Image](https://pub.pbkrs.com/uploads/2025/df7138d2438dfb65b4c92684dffe976e?x-oss-process=style/lg) **This global offering consists of 20.1598 million shares, with 200 shares per lot. As of the time of writing, it is oversubscribed by 4.37 times. The scale is not large, and there is a high likelihood of triggering a clawback to 30%. An estimated 10,000-20,000 participants are expected, with a single-lot winning rate of 30%. Applying for 30 lots ensures one lot.** **What is the industry outlook and competitive landscape for the company?** **Core carbon neutrality track: CCUS (Carbon Capture, Utilization, and Storage) is a key technology for achieving carbon neutrality globally. The company focuses on the bio-conversion of industrial tail gas (converting carbon-containing exhaust from steel/ferroalloy plants into ethanol and protein feed).** Rapid market growth: Global CCUS investment is projected to increase from $12.6 billion in 2023 to $76.8 billion in 2028 (a CAGR of 43.5%). China's market size is expected to grow from RMB 21.6 billion to RMB 99.3 billion (a CAGR of 35.7%). Clear downstream demand: Fuel ethanol: China promotes ethanol gasoline policies but strictly controls grain-based ethanol. The company's technology, which uses industrial tail gas as feedstock, aligns with policy directions and has lower costs than grain-based ethanol. Sustainable Aviation Fuel (SAF): Global aviation mandates (e.g., the EU requires 6% SAF by 2030). The company is building SAF production lines to tap into a trillion-yuan market. Microbial protein feed: Replaces soybean/ fishmeal, certified by China's Ministry of Agriculture, and aligns with the "reduce soybean meal" policy. Strong policy support: China includes industrial tail gas-to-ethanol/protein in the "Green Low-Carbon Transformation Industry Guidance Catalog," offering tax incentives. The crackdown on coal-to-ethanol in the fuel market creates space for the company's tail gas-to-ethanol technology. Shougang Langze operates in the high-growth carbon neutrality sector, holding a global leadership position in synthetic bio-CCUS with its exclusive bio-conversion technology and first-mover scale advantage. Driven by policy (ban on coal-to-ethanol, SAF promotion) and market demand (fuel ethanol/low-carbon feed), it faces challenges in raw material supply stability and price fluctuations. Its competitive moat lies in hard-to-replicate engineering capabilities and continuous technological iteration. Disruptive competitors are unlikely in the short term, with long-term growth potential focused on SAF and second-generation negative carbon technology. **How is the company's financial performance? Is cash flow sufficient?** Shougang Langze's revenue for 2022-2024 was RMB 390 million, RMB 593 million, and RMB 564 million, respectively, with a CAGR of 15.75%. Net losses for 2022-2024 were RMB 23.855 million, RMB 110 million, and RMB 246 million, totaling RMB 380 million over three years. ![Image](https://pub.pbkrs.com/uploads/2025/069f3f325eec76cdb0c36d49f01a5eff?x-oss-process=style/lg) 2024 cash and equivalents were RMB 111 million, down 39.34% from RMB 183 million in 2023**,** **with short-term debt of RMB 270 million due within one year, indicating a significant liquidity gap.** ![Image](https://pub.pbkrs.com/uploads/2025/40f4cf3a1f2b0757982ca6e0dbec2109?x-oss-process=style/lg) **Who are the company's historical investors, cornerstone investors, and sponsors?** The company completed multiple pre-IPO funding rounds, with the last in April 2022 at a post-money valuation of RMB 4.3 billion (~HK$4.712 billion), costing RMB 11.94 (~HK$13.08) per share, a 21.62% discount to the offer price. The sole sponsor is Guotai Junan, which also acts as the stabilizing agent. Guotai Junan's historical projects are primarily focused on "loom" strategies. **Lock-up period: Pre-IPO investors are locked in for 12 months.** **What is the subscription plan for this offering?** After reviewing the company's technology, I was initially impressed. Shougang Langze is a leader in the core CCUS carbon neutrality sector, being the first globally to commercialize large-scale bio-fermentation of industrial tail gas into ethanol (Hebei Shoulang commenced production in 2018). Playing the scarcity card, Shougang Langze has narrative appeal, reminiscent of Saint Bella. However, research revealed peer company LanzaTech, listed in the U.S. with a market cap of HK$500 million and revenue of RMB 355 million. Shougang Langze's IPO valuation of HK$5.512-7.177 billion on revenue of RMB 563 million appears expensive by comparison. While its technological edge is clear, the environmental sector lacks allure. This offering raises HK$292-381 million, a modest size, with no cornerstone investors. Sponsor Guotai Junan's track record is mediocre. Overall, this seems another speculative gamble. Given other more certain opportunities, I'll likely pass for now. $Shougang Lanza(02553.HK) **Disclaimer:** Investing carries risks; participation requires caution. The mentioned securities are personal trading records and do not constitute investment advice. Losses incurred are not the author's responsibility. If this content helps, please like, share, and recommend it to friends in need. Thank you! ### Related Stocks - [000959.CN](https://longbridge.com/en/quote/000959.CN.md) - [02553.HK](https://longbridge.com/en/quote/02553.HK.md)