Update as Dawn Terminates Biodegradable Materials Project Amid Market Challenges

On March 10, 2025, Dawn Co., Ltd. held its 21st meeting of the fifth board of directors, where it approved the decision to terminate the investment in the biodegradable materials project.

The company cited several reasons for this decision. Despite strong policy support for the promotion and application of biodegradable plastics due to recent bans and restrictions on plastic use in China, the market for biodegradable materials is facing significant challenges. Issues such as weak demand growth, excess capacity, and intensifying competition have created mounting pressure on the market.

In reassessing the current market environment and the project's positioning, Dawn decided to halt the project to avoid further resource waste and reduce potential economic losses, thereby safeguarding the interests of the company and its shareholders.

Previously, on March 11, 2022, Dawn had signed a cooperation agreement with the Daxin Subdistrict Office in Jimo District, Qingdao, planning to invest 500 million yuan in the biodegradable materials project. The project was set to be developed in two phases, focusing on the production of biodegradable raw materials, soft packaging products, straws, cutlery, and take-out containers.

In its 2024 financial report, Dawn achieved a total revenue of 5.301 billion yuan, reflecting a 16.65% year-on-year increase, with a net profit attributable to shareholders of 141 million yuan, up 0.67%. The elastomer segment reported revenue of 768.03 million yuan, growing 21.34%, while the modified plastics segment saw revenue of 3.805 billion yuan, an increase of 19.18%. The color masterbatch segment also reported a revenue rise of 18.94%, reaching 247.09 million yuan.