On August 10, 2026, after a nearly one-week trading suspension, the anticipated change of control at Baolai Medical (300246.SZ) was announced as terminated. This negative news directly triggered a massive sell-off in the secondary market. The stock of Baolai Medical was immediately and firmly pinned down by huge sell orders at the 20% limit-down level. By the close, the stock price was fixed at 15.41 yuan per share.
For Baolai Medical, however, this price drop triggered by the collapse of the "change of control" expectation was far from a simple emotional reaction. At the operational level, the company's core hemodialysis business is deeply mired in the price war of centralized procurement, growth in the patient monitor track has peaked, and three consecutive years of massive losses show no sign of reaching breakeven anytime soon.
The entry of Zhejiang Quwei Zhihe Equity Investment Partnership (Limited Partnership) (hereinafter referred to as "Quwei Zhihe") in January this year gave outsiders a glimpse of another possibility for the company. The announcement of a control rights transfer just over a week ago further fueled speculation that Weigu Information Technology (Quzhou) Co., Ltd. (hereinafter referred to as "Weigu Information") behind Quwei Zhihe, which focuses on solid-state storage and computational fusion solutions (storage chips), might be seeking a backdoor listing. However, it now appears this illusion has been shattered.
Lightning Termination of Control Change
Rewinding to the evening of July 31, 2026, Baolai Medical suddenly announced that its controlling shareholder, Yan Jinyuan, and concerted actor, Wang Shi, were planning a major event that could lead to a change in the company's control. This news, like a depth charge, instantly ignited market speculation.
In fact, the sprout of a change in control began budding as early as the beginning of January this year. On January 12, 2026, against the backdrop of a clearly deteriorating performance, controlling shareholder Yan Jinyuan and concerted actor Wang Shi signed a Share Transfer Agreement with Quwei Zhihe, transferring 7% of the company's shares at a price of 9.45 yuan per share, cashing out approximately 175 million yuan. On May 28, the transfer of these shares was completed, and Quwei Zhihe officially became a major shareholder holding over 5%.
Established in September 2025, Quwei Zhihe itself has no relevant physical operations. More noteworthy is the nationally recognized "Little Giant" specialized and sophisticated enterprise standing behind it, Weigu Information.
Image source: Tianyancha APP
Based on public information, the company focuses on high-reliability specialized solid-state storage business, with self-developed flash memory controllers and firmware algorithms. Its products cover chip-level, embedded, and ruggedized storage solutions, primarily targeting high-reliability scenarios such as aerospace, military equipment, rail transportation, and automotive, while also venturing into the information technology application innovation and industrial storage tracks. Its core team possesses technical backgrounds in supercomputing projects and holds a complete set of military qualifications.
Due to its development in the storage business, it has also attracted investors with industrial and state-owned capital backgrounds. In December 2020, the company completed a 200 million yuan Series C financing round with participation from investment platforms affiliated with China Aerospace Science and Industry Corporation, Chinalco Capital, Shandong High-Speed, and other central and local state-owned enterprises, along with industrial capital from several listed companies. In September 2021, the company secured another several hundred million yuan in Series C+ financing, attracting leading institutions like Shenzhen Capital Group, Qianhai Mother Fund, and More than Moore Fund. In August 2024, it completed a D+ round of financing.
Clearly, Weigu Information and Baolai Medical have vastly different core businesses, fueling market and investor fantasies. It was precisely based on this strong expectation of a "cross-industry restructuring" that Baolai Medical's stock price more than doubled within 2026. The stock price rose continuously from the closing price of 8.61 yuan on January 5, reaching an intraday high of 21.67 yuan on May 20, representing a maximum increase of 151.68% during this period. By the suspension on July 31, the year-to-date increase was as high as 137.78%, with a surge of 10.37% on the last trading day before the halt.
Image source: Choice
But all of this was shattered by the announcement on the evening of August 7 disclosing the termination of the planned control change. Baolai Medical stated that during the suspension, the controlling shareholder and the counterparty fully discussed the relevant major matters. "Due to the complexity of the matters involved, and after careful consideration and listening to various opinions, the relevant transaction parties have decided to terminate the planning of this control change."
Deep in the Quagmire of Losses
If the termination of the control change is the direct trigger for the stock price collapse, then Baolai Medical's loss-making fundamentals are the fundamental reason for its 20% limit-down.
As a veteran medical device company listed on the ChiNext board in 2011, Baolai Medical initially established its market position relying on its patient monitor business. As time passed, the hemodialysis business has grown into the company's largest revenue pillar, with the corporate focus shifting towards renal care. However, the monitor business has not exited; it remains an important high-margin business segment, running in parallel with the hemodialysis business.
Since 2023, Baolai Medical has been mired in continuous losses. Financial data shows that from 2023 to 2025, the company's net profits were -65.1851 million yuan, -71.4413 million yuan, and -69.4278 million yuan respectively, with cumulative losses exceeding 200 million yuan over the three years. Entering 2026, the loss-making trend has not been contained. The first-quarter financial report shows the company's revenue fell 1.91% year-on-year to 243 million yuan, with a net loss of 7.3189 million yuan. The non-GAAP net loss even widened to 14.6275 million yuan.
Image source: Choice
The primary reason is the centralized procurement (volume-based procurement) of medical consumables led by the National Healthcare Security Administration. With the comprehensive implementation of domestic hemodialysis consumables centralized procurement, prices of products like dialyzers and dialysis fluids have plummeted, severely squeezing Baolai Medical's gross margin.
More urgently, the company faces immense short-term debt repayment pressure. As of the end of the first quarter of 2026, the company's current liabilities amounted to 830 million yuan, while the book monetary funds were only 457 million yuan. Relying solely on existing monetary funds is insufficient to cover all short-term liabilities. Coupled with the imminent maturity of the Baolai convertible bond, short-term liquidity pressure is even more critical. The company's convertible corporate bond "Baolai Bond" is set to mature on September 3, 2026, with a remaining principal amount of approximately 218 million yuan. Against the backdrop where the current stock price (15.41 yuan) is far below the conversion price (18.30 yuan), it is almost impossible for bondholders to choose conversion. This means Baolai Medical faces significant short-term cash repayment pressure.
Image source: Choice
Therefore, the company has had to close out previously raised capital projects and permanently supplement working capital with the remaining 60.6631 million yuan of raised funds.
For Baolai Medical, the termination of the control change may just be a long-overdue release of negative news. However, how to fill the profit hole in its main business and how to resolve the impending debt crisis are the urgent problems facing management. (By | Company Observation, Author | Cao Shengyuan, Editor | Deng Haotian)
