Most things in the Chinese military system are numbered rather than named. Military units are numbered twice - a public cover designator and a private true unit designator, originally four and later five digits. Factories got a three digit number - 296 for the small arms factory in Jiangshe, 816 for the uranium enrichment plant in Fuling and so on. Everyone in and around Factory 404 would have known it as such, but the mere existence of Factory 404 was a state secret.
The existence of such a large and conspicuous secret might seem bizarre to the post-cold-war mind, but it was fairly common in the West too. For example, the British Telecom Tower in central London stands at 189 metres tall and had a revolving restaurant that was open to the public, but was also a designated site under the Official Secrets Act.
Is it victim of the enumeration vulnerability, ie between 403 and 405 you can guess what they were busy with and therefore identify the activity? Or do they randomize the numbers, but then just 3 digits seems little for such a big country?
The existence of such a large and conspicuous secret might seem bizarre to the post-cold-war mind, but it was fairly common in the West too. For example, the British Telecom Tower in central London stands at 189 metres tall and had a revolving restaurant that was open to the public, but was also a designated site under the Official Secrets Act.