84: Chapter 84 Late Night Operations Room, Counterattack Deployment

8:00 PM, August 5th, Emergency Conference Room, top floor of Xinghuo Headquarters.

The incandescent lights of the conference room illuminated every weary and solemn face with a cold, hard glare.

The heavy soundproof door was tightly shut, sealing off the noise and speculation from the outside world.

Beside the long conference table, Su Chen sat in the center. To his left were Lin Wan and Shen Nanpeng, and to his right were Legal Director Liang Zhen and the Hongqi Automobile CEO Zhou Qingyu, who had just joined via a remote link.

The air was thick with the scent of strong coffee and a palpable tension.

Shen Nanpeng was the first to activate the projector in front of him. The cold blue light cast upon his face, highlighting the dark circles under his eyes.

The screen flickered with core data from today's trading; every number felt like a heavy blow.

"Today's turnover was 58 billion rmb, with a turnover rate of 3.2%," he said, his voice raspy but clear.

"Note that our typical daily turnover rate is usually less than 1%. This means a massive amount of shares changed hands in a panic. Based on seat and trading characteristics, the scale of forced liquidation for margin financing positions is approximately 8 billion rmb."

He pulled up another chart, which was densely packed with the distribution of warning lines for margin financing accounts.

"According to our model, if the stock price continues to fall tomorrow, around the 1750 rmb mark, another 4 billion rmb of margin financing positions will face forced liquidation risks. Once this level is breached..." Shen Nanpeng paused, his gaze sweeping across the room.

"The technical selling pressure could trigger a chain reaction, potentially even hitting the risk control lines of some public funds and causing passive redemptions, leading to a much wider stampede."

"1750..." Lin Wan softly repeated the number, her fingers tracing a line on the table unconsciously.

This was nearly 3% lower than today's closing price. While it seemed far from the "800 rmb" target price in the short-selling report, in a market where emotions were collapsing, the breakdown of psychological defenses often came faster than the collapse of actual value.

Legal Director Liang Zhen adjusted his glasses. In front of him lay a paper copy of the short-selling report, covered in yellow sticky notes at key points.

"The report's accusation regarding the 'exceeding expectations' of the Red Flag project costs relies on a core 'piece of evidence' that cites an internal cost estimate draft numbered 'HQ-CB-202704-DRAFT'. This draft does exist," he said, his speech steady and carrying the characteristic rigor of a legal professional.

"But it was an early version we used for initial project evaluation four months ago, in April of this year. It was full of the most conservative assumptions and the most pessimistic estimates. The formal, board-approved final budget plan 'HQ-CB-202707-FINAL' replaced it three months ago. The overall budget was optimized by 15%, and the technical path is much clearer. The short-seller either obtained outdated information or deliberately used the early draft to exaggerate costs."

In the video feed, Zhou Qingyu was in his office at the Changchun Red Flag R&D Center, which was also brightly lit.

The former global vice president of Volkswagen had a resolute face, though his brows were tightly furrowed.

"Mr. Su, everyone," his voice came through the speaker with the distinct force of a Northeastern accent. "The report's description of the R&D cost overruns for the 'spark super energy' platform I am responsible for is taking things out of context. We did increase the budget due to higher battery safety standards and intelligent chassis performance goals, but the product premium and technological barriers brought by this investment are enough to cover it in future market returns. I can provide the complete project financial rolling forecasts audited according to international accounting standards."

He leaned forward slightly, staring into the camera. "If necessary, I can fly over overnight and, at tomorrow's press conference, in front of all the media, clearly explain the purpose and current progress of every major investment in Hongqi Automobile since the acquisition."

Su Chen had been listening quietly, his fingers tapping unconsciously on the smooth tabletop.

Only after everyone had finished their reports did he speak slowly: "The situation is clear. The other side is playing a game of information asymmetry and psychological warfare. They know investors cannot verify Red Flag's true costs in the short term, nor can they personally count our chip yield rates. They only need to throw out sufficiently alarming numbers to ignite panic; the market's own leverage and emotions will do the rest of the killing."

His gaze sharpened. "Therefore, our response cannot just be a defense; it must be a combination of punches that can simultaneously stop the bleeding, relieve the pain, and show our muscles."

Shen Nanpeng immediately took over, pulling up his pre-prepared PPT, titled "Plan A: Thunderous Buyback — Defending Value with Capital."

"My suggestion is to immediately and publicly announce a share buyback plan with a cap of 20 billion rmb. The maximum buyback price can be set at 2200 rmb, which is more than 20% above today's closing price," he said, his tone becoming impassioned.

"This is the most direct and powerful weapon. Using the company's real cash to buy our own shares on the open market declares to the whole world: management believes the company's value is severely undervalued and is willing to prove it with action. This can most quickly stabilize the stock price, break the downward spiral, and give the market a clear price anchor."

He paused, also frankly admitting the risks: "The cost is the consumption of precious cash reserves. 20 billion rmb accounts for over 15% of our cash on hand. Although our cash flow is abundant, this money was originally earmarked for the construction of new chip production lines and the Germany battery factory. It will need to be reallocated."

Lin Wan shook her head slightly and opened her notebook. "I understand the impact of a buyback, Nanpeng. But I feel that in a panic, just showing 'we have money' might not be enough, and it could even be interpreted as being 'at the end of our rope' and having to use money to brute-force it."

She pulled up a set of data. "Plan B: Robust Disclosure and Sustainable Returns. First, break convention and disclose the third-quarter earnings forecast early. Our preliminary calculations show that even under the current situation, the net profit for the third quarter is still expected to achieve a year-on-year growth of over 50%, which can directly falsify the accusation of a 'growth cliff'. Second, simultaneously announce the 2017 interim dividend plan, distributing a cash dividend of 4.5 rmb per share, totaling about 4.725 billion rmb."

She looked around at everyone, her tone firm: "The significance of the dividend is not in the amount, but in the signal — a company capable of sustained, stable, and high-amount dividends must have healthy cash flow and earnings quality; it is by no means the 'verge of a black hole' as depicted in the report. This reflects our business resilience and management's confidence in the future better than a one-time buyback, and it is more sustainable. A buyback is 'treating the symptoms'; proving value and reshaping long-term investor confidence is 'treating the root cause'."

The two plans represented two completely different crisis management philosophies: Shen Nanpeng's capital maneuvering was fast, accurate, and ruthless, aiming to instantly reverse market sentiment; Lin Wan's operational thinking focused more on demonstrating fundamentals and long-term trust restoration.

There was a brief silence and contemplation in the conference room.

Just then, Su Chen leaned forward, hands clasped on the table, and said something that made everyone slightly shocked: "A and B are both necessary. But it's not enough. Pure defense is always passive."

His gaze swept across the room: "We are going to attack. Launch a private placement."

"Private placement?" Lin Wan blurted out, almost thinking she had misheard. "Now? Launching a private placement when the stock price is plummeting and market confidence is fragile? How will the outside world see it? They will say Xinghuo is raising money at a high stock price, or even taking advantage of the crisis to 'drain blood'!"

Shen Nanpeng also frowned, quickly calculating in his head: "Mr. Su, according to the rules, the private placement price cannot be lower than 80% of the average price of the 20 trading days before the base date. Even calculated based on the stock price after the sharp drop, the base price will be pulled down, and the issue price will likely..."

"The issue price will be set at 2000 rmb/share," Su Chen clearly stated the number. It was exactly yesterday's closing price, 11% higher than the price after today's plunge. "The total financing amount is 100 billion rmb, with approximately 50 million new shares."

This number made the conference room quiet again, with only the low hum of the air conditioner remaining. An issue price of 2000 rmb, in the current market conditions, seemed incredibly bold, even arrogant.

Su Chen slowly explained his logic, his words clear: "A buyback is telling the market 'we think we are undervalued'; a dividend is telling the market 'we are healthy and have money to share'. But these are still explaining and defending. A private placement, however, is letting the smartest and most cautious top investment institutions in the market vote with real money — if they believe Xinghuo is severely undervalued, believe in the future of Red Flag and the chip industry, and believe in Su Chen and this team, then please, when the stock price is at 1800 rmb, agree to invest at a price of 2000 rmb."

He paused, his eyes burning like torches: "This is no longer our self-justification, but dragging in a group of heavyweight 'co-defendants'. If they dare to invest, it is the most powerful rebuttal to the Grey Rhino report and the most solid endorsement of Xinghuo's value. This is more effective than us issuing a hundred clarification announcements. If it fails..." Su Chen didn't continue, but everyone understood what that meant — the market would vote with its feet, completely denying the company's future valuation.

Shen Nanpeng's eyes gradually lit up. He saw the extreme risk behind this plan and the equally extreme strategic value: "This... this is a huge gamble. But if it succeeds, it will be a financial nuclear bomb launched at the short sellers. It will not only stabilize the stock price but also establish a funding advantage and strategic allies for the next few years in one fell swoop."

Lin Wan was still worried: "I understand the logic, Su Chen. But 100 billion rmb is not a small amount, and time is so tight. Who can take it? Who dares to take it?"

"That's why we are not looking for ordinary financial investors," Su Chen said in a deep voice. "We are looking for strategic capital that can see the technological and industrial trends of the next ten or twenty years, and ecological partners that can form synergies with us on the battlefields of chips, new energy, and intelligent vehicles. This money must be clearly used for the 'full industrial chain autonomy of chips' attack. I've even thought of a name — let's call it the 'Flint Project'. We are not raising money; we are gathering provisions and comrades for a technological Long March that will determine the nation's destiny."

He looked at Shen Nanpeng and Lin Wan: "Buyback (A), Dividend (B), Private Placement (C), three-pronged approach. A quickly stops the bleeding and relieves pain, B shows a healthy body, and C declares future ambition and binds allies. Only by combining the three can we turn this crisis into an opportunity for value revaluation and strategic upgrading."

With the strategic direction set, the atmosphere in the conference room shifted from heavy to an excitement that carried a sense of burning bridges. Su Chen began assigning tasks like a commander.

"Alright, since it's decided, let's act immediately." Su Chen looked at the PR Director. "Your department, work overnight to prepare for the global press conference at nine o'clock tomorrow morning. I will attend in person, accompanied by Ms. Lin and Mr. Shen. The content of the release will be these three decisions. The speech must be tough, the data must be solid, but the attitude must be open. Reserve plenty of time for Q&A, especially for sharp questions from foreign media; do not avoid them."

"Finance Department, Securities Department," he turned to the other two heads. "Coordinate and work overnight to produce the complete plan for the 'Flint Project' private placement, including detailed capital usage plans, project feasibility analysis, and most importantly — the technical milestones and financial forecasts for the next three years. I want to see the first draft before dawn."

"Liang Zhen," Su Chen looked at the Legal Director. "Your task is in two steps. First, collect all evidence that can prove the factual errors and misleading statements in the Grey Rhino report, especially the false accusations regarding that outdated draft and chip yield rates. Prepare a lawyer's letter and evaluate the possibility of filing defamation or commercial disparagement lawsuits in major global jurisdictions. Second, ensure that all information we are about to release complies with the strictest securities regulations; do not leave any handles for our opponents."

"Mr. Zhou," Su Chen looked at the video screen. "You don't need to fly over. There is a more important task: immediately prepare the video material of the first white body roll-off of the car model. It needs to be high-definition, multi-angle, and preferably have close-ups and data parameter displays of key process steps. At the same time, organize a report on the latest R&D progress of the 'spark super energy' platform, speaking with facts and data. I will use these materials at tomorrow's press conference."

Zhou Qingyu nodded heavily on the other end of the video: "Understood, Mr. Su! I will organize the staff immediately and send the materials within two hours!"

Finally, Su Chen's gaze fell on Shen Nanpeng, his tone grave: "Nanpeng, the most arduous and core task is for you and me. We have to make calls personally tonight."

He took out a handwritten list. There were only five names/institutions on it, yet it felt as heavy as a thousand pounds: 1. Huawei Investment (strategic tie with Huawei Group), 2. Shencheng Metro Group (local cornerstone), 3. SASAC National Integrated Circuit Industry Investment Fund (national team direction), 4. Saudi Public Investment Fund (PIF, a sovereign wealth giant seeking energy transition and technology layout), 5. Temasek Holdings (Singapore, a top sovereign fund known for its long-term vision and stability).

"The success of this 100 billion rmb 'Flint Project' depends on whether we can get preliminary support from at least two or three of these top strategic investors immediately," Su Chen said. "I will personally contact Huawei, the national team, and the Saudi side. Nanpeng, you are responsible for the Shenzhen SASAC and Temasek. We are not going to beg for investment; we are going to find comrades. Tell them what Xinghuo is going through, what we want to do, and why they should join at this moment. What we need is an initial statement of 'interested in principle' or 'willing to evaluate with priority'. Even if it's just verbal, it is crucial for our press conference tomorrow."

Shen Nanpeng took a deep breath and accepted the heavy responsibility. He knew that every word of these calls could be interpreted repeatedly, and the difficulty and pressure were no less than commanding a financial battle.

The meeting ended near ten o'clock at night. Everyone dispersed quickly, each diving into the battle. Su Chen did not leave. He stood in front of the floor-to-ceiling window, gazing at the brilliant yet cold night view of Shenzhen outside. The neon lights in the distance flickered, like countless anxious and greedy eyes of the market.

Lin Wan brought him a cup of hot tea and asked softly: "Nervous?"

Su Chen took the teacup, feeling the warmth in his palm. "A little. But more... a strange excitement." He shook his head slightly. "It's like playing chess. The opponent suddenly makes an unexpected killer move. Although it's thrilling, it makes the game more interesting. The Grey Rhino thought they found our weakness, but perhaps they didn't realize they also forced us into a position where we must reveal all our hole cards and show our true determination."

He turned around, his eyes reigniting with the familiar, almost stubborn light that Lin Wan knew: "In this battle, we must not only defend the stock price but also let the whole world see that Xinghuo's ambition and resilience are far more than a two-trillion market value. We must turn this attack into the best opening statement for the 'Flint Project' roadshow."

It was late at night, and many windows in the Xinghuo Headquarters building were still lit, like a giant ship sailing firmly on the dark sea, adjusting its cannons, preparing to let out its roar at dawn.