Bottom reading ST shares need to be cautious.
On March 30, the first delisting share of A-Shares in 2022, “delisting Xinyi ( Xinjiang Yilu Wanyuan Industrial Investment Holding Co.Ltd(600145) . SH)” ushered in the first trading day of the delisting consolidation period. On the 29th, delisting Xinyi released the first risk prompt announcement of entering the delisting consolidation period. The company’s shares entered the delisting consolidation period of 15 trading days on March 30, and there was no limit on the rise and fall of day
According to the stock listing rules, the Shanghai Stock Exchange will delist the company’s shares and terminate the listing of the company’s shares within 5 trading days after the expiration of the delisting consolidation period.
Precisely because there is no limit on the rise and fall, the delisting of Xinyi will directly “collapse”:
On March 2, the trading day before the suspension, the share price remained at 1.03 yuan / share. Today, it directly fell nearly 72% to close at 0.28 yuan / share within one minute of opening. The latest total market value was 417.5 million according to statistics, this is the biggest opening decline of A-Shares in 30 years this is equivalent to a “knee cut” directly to the 24000 shareholders. There was a cry of misery in each stock bar. Some investors said, “if a car loses money, the new billion will be withdrawn from the market, and I will also withdraw from the stock market.” Judging from this momentum, the delisting share price of Xinyi may return to zero indefinitely in the next 14 days.
In fact, as early as March 22 this year, Xinyi announced that the company was forced to delist due to major violations of the Shanghai stock exchange due to financial fraud. The company’s shares will enter the delisting consolidation period on March 30, 2022, and are expected to be delisted after April 21, 2022.
It is worth pondering that in the process of delisting Xinyi share price callback, bottom hunters were enthusiastic. From the perspective of the number of shareholders, the number of shareholders of the stock was less than 20000 at the end of the first quarter of last year, reaching 23830 in the interim report of last year, and last year’s third quarterly report further increased to 24087
financial fraud has clear facts and bad means
involving major illegal delisting
On March 22 this year, the delisting Xinyi issued an announcement on the termination of the listing of shares.
The announcement shows that due to the company’s false increase in operating revenue in 2018 and 2019, the financial indicators from 2018 to 2020 have actually touched the situation of major illegal compulsory delisting, and the Shanghai Stock Exchange decided to terminate the listing of the company’s shares. The company’s shares will enter the delisting consolidation period from March 30.
Previously, on March 2, delisting Xinyi received the supervision letter on matters related to the suspension and termination of the listing of Xinjiang Yilu Wanyuan Industrial Investment Holding Co.Ltd(600145) company’s shares issued by the Shanghai Stock Exchange. It shows that the Shanghai Stock Exchange has issued a prior notice of the intention to terminate the listing of delisting Xinyi shares, and the subsequent decision to terminate the listing of the company’s shares will be made within the specified time according to the review opinions of the listing committee.
On the same day, the delisting Xinyi also issued an announcement to disclose the receipt of the decision on administrative punishment and the decision on banning market entry by the CSRC.
According to the decision on administrative punishment, there are false records in the annual reports of delisting Xinyi in 2018 and 2019:
includes inflated operating income of 133854 million yuan and total profit of 1.2911 million yuan in 2018, accounting for 100% of the operating income disclosed in the current year and 5.24% of the absolute value of total profit;
falsely increased the operating revenue of 5.7236 million yuan, non operating revenue of 75.9 million yuan and total profit of 792482 million yuan in 2019, falsely increased operating revenue and total profit accounted for 55.13% and 253.78% of the disclosed operating revenue and total profit of the current year respectively.
Delisting Xinyi has obvious intention to avoid delisting through financial fraud, and the means are relatively simple and rough. For example:
Delisting Xinyi signs trade contracts and uses funds to circulate between actual controllers and friends to confirm income; Another example is to recognize the property income when the property service is not provided and there is no property management cost; Even if the rent credit agreement is signed reversely with the relevant parties, the operating income will be falsely increased when the relevant parties do not actually lease the property, manage the sublease or receive the Sublease Rent, and the relevant debts are not offset.
It is worth noting that in the year of financial fraud, the number of delisting new 100 million employees was only more than a dozen.
According to China business, “the limited resources determine the singleness and rudeness of its fraud methods, which also precisely reflects the subjective malignancy and bad circumstances of delisting Xinyi’s’ creating conditions and fraud ‘to avoid delisting.” Some insiders say so.
In addition, the decision on administrative punishment also shows that in addition to false records, there are also major omissions in delisting Xinyi
was involved in the case of illegal fund-raising of the Department of Chinese technology
actual controller Huang Wei et al. “White wolf with empty hands”
According to public information, Chongqing Siwei Ceramics Co., Ltd., the predecessor of delisting Xinyi, was listed on the Shanghai Stock Exchange on September 23, 1999. At the beginning of listing, the company’s main business was all kinds of ceramics, including ordinary ceramics, industrial ceramics, bathtub, kitchen equipment, etc., which was once known as “the first share of China’s professional sanitary ware” .
After the listing, the delisting of the new billion changed owners. The company has successively owned many former securities names such as “four-dimensional porcelain”, “four-dimensional holding” and “guochuang energy”, and the registered places are transferred to Chongqing, Shanghai, Guizhou and Xinjiang.
According to shell finance, in 2008, delisting Xinyi ushered in the entry of the Chinese Technology Department of “capital player”. In November of the same year, Shenzhen yifengyuan, an affiliated enterprise of Shenzhen China technology, became the owner of 4D holdings and became A-share listed company of China Technology Department. In July 2011, the main body of the company was renamed “Guizhou Guochuang Energy Holding (Group) Co., Ltd.” therefore, the stock abbreviation was changed to ” ST guochuang”, claiming to transform the energy field.
The entry of the Chinese technology department will eventually bring the delisted Xinyi into the situation of “one place chicken feather”.
According to previous reports of the Beijing News, 4D holdings plays the role of “money bag” in the system of China’s technology department. Its funds are arbitrarily misappropriated, but its business is nothing more than chicken feathers.
In terms of performance, the company’s net profit fell from a profit of 5.92 million yuan in 2007 to a loss of 272 million yuan in 2008. In 2009, the company still lost 132 million yuan. After making a profit of 57.93 million yuan in 2010, it lost another 23.63 million yuan in 2011.
Not only that, the Department of Chinese technology also left billions of yuan of debt for delisting. In December 2015, the delisting Xinyi announcement, which was planning bankruptcy reorganization, announced that four Shanghai Youdao partnerships had declared about 1.02 billion yuan of creditor’s rights to delisting Xinyi. Shanghai Youdao is an illegal financing platform under the Department of Chinese technology.
Earlier in May 2014, an illegal fund-raising case occurred in the Department of Chinese technology, and then the head of the Department of Chinese technology, Cheng Qingbo, was taken away by the police. In April 2016, the first instance judgment of Shanghai Jing’an District People’s court showed that Cheng Qingbo, a Chinese technology department, illegally absorbed more than 1.2 billion public deposits and was sentenced to fixed-term imprisonment for one year and one month and fined 20000 yuan.
In January 2016, the bankruptcy reorganization of delisting Xinyi was approved by the court, but it did not save the fate of delisting Xinyi.
The restructuring plan disclosed by delisting Xinyi finally shows that the investors involved in the restructuring of delisting Xinyi include Wanyuan Xijin (the largest shareholder and actual controlling shareholder of delisting Xinyi), Shanghai Yuandi (the second largest shareholder of delisting Xinyi), and the actual controller of listed company is Huang Wei
On June 28, 2021, the announcement of delisting Xinyi disclosed that the company and more than 10 current directors, supervisors and senior staff were fined from 30000 yuan to 900000 yuan, and four current management personnel, including Huang Wei and Pang Jiandong, were banned from the market for five to ten years, because they failed to disclose the occupation of non operating related funds and illegal guarantees as required, involving an amount of more than 1.1 billion yuan, which almost “hollowed out” the delisting Xinyi assets
According to the above announcement, delisting Xinyi repeatedly used the name of signing purchase contracts to advance large amounts of funds to delisting Xinyi related party enterprises, and finally most of the 1.1 billion funds were flowing into the hands of the controlling shareholder Wanyuan Xijin.
What is more worth mentioning is that after the regulation, it was found that the consideration of the restructuring investment funds of Wanyuan rare gold and Shanghai Yuandi were about 300 million yuan and 140 million yuan respectively, almost all of which came from the delisting funds of listed companies. In other words, in the whole process of reorganization, Huang Wei and others are “covering the white wolf with empty hands”.
Under the repeated “capital operation”, the performance of delisting Xinyi will not look good. According to previous annual reports, in 2018 and 2019, delisting Xinyi achieved revenue of 133854 million yuan and 103822 million yuan respectively, meeting the requirements of shell protection.
However, such performance still has a lot of water. On February 19, 2021, the CSRC announced that it had filed an investigation into the delisting Xinyi and Shenzhen Tangtang accounting firm’s suspected violations.
The follow-up survey results showed that the delisting Xinyi falsely increased the operating revenue of RMB 133854 million and the total profit of RMB 1.2911 million in 2018, accounting for 100% of the disclosed operating revenue and 5.24% of the absolute value of the total profit in that year; Falsely increased the operating revenue, non operating revenue and total profit of 2019 by 5.7236 million yuan, 75.9 million yuan and 792482 million yuan, accounting for 55.13% and 253.78% of the disclosed operating revenue and total profit respectively.
The CSRC said that Tangtang office, knowing that the audit business of delisting Xinyi’s annual report has been “rejected” by other accounting firms, signed an agreement with delisting Xinyi, promised not to issue “unable to express opinions” or “negative opinions” in the audit report, and required that delisting Xinyi should be compensated in case of punishment by the regulatory authorities.
“delisting” cannot be “free of charge”, and investors can claim
Although the delisting Xinyi is facing delisting, the relevant responsible person will never “avoid orders” for this reason. A legal person said that in the delisting process of listed companies, investors can rationally claim shareholders’ rights through legal channels the current system provides many ways to protect the rights of small and medium-sized investors:
First, shareholders can take measures to safeguard shareholders’ rights according to the actual situation. If the company has illegal information disclosure such as false statements, and investors suffer losses, they can seek civil relief or compensation through judicial channels on the grounds that they have been infringed by false statements.
Second, in case of disputes between investors and listed companies, they can apply to investor protection institutions for mediation; Or when filing securities civil compensation litigation such as false statements, the investor protection institution may be entrusted to participate in the litigation as a representative.
Third, even after the termination of listing, the shareholders of the company can still exercise their rights according to law. After the company’s listing is terminated, although its shares are not traded on the Shanghai stock exchange market, its assets, liabilities, operations, profits and losses and other situations do not change accordingly. According to the provisions of the company law, after the termination of listing, the shareholders of the company still enjoy the rights of shareholders such as the right to know the company and the right to vote, and the rights enjoyed by shareholders will not change. After the listing is terminated, the shareholders of the company can still transfer their shares in accordance with the provisions.
diversified delisting has gradually become the norm
Will the delisting bell of Xinyi delisting “wake up” the “dream of listed companies” of a number of high-risk delisting companies?
On the evening of March 29, the general office of the CPC Central Committee and the general office of the State Council issued the opinions on promoting the construction of social credit system and high-quality development and promoting the formation of a new development pattern, which focused on “strictly implementing the compulsory delisting system and establishing a virtuous cycle mechanism for the survival of the fittest of listed companies” .
In addition to delisting the new billion, many A-share companies are also facing delisting risks this year.
According to the announcement query, it can be roughly found that since this year, dozens of companies have issued the announcement of termination of listing risk, suggesting that there are relevant risks. The delisting risks faced by the above companies vary, including financial reasons, transaction reasons, etc.
Experts said that according to the financial delisting process of the new delisting regulations, companies whose financial conditions do not meet the standards in the first year will be subject to delisting risk warning, and companies whose financial indicators do not meet the standards in the second year will be directly delisted. This means that “shell” and “zombie” companies only need two fiscal years from being identified to delisting, so 2022 will be a year in which the effectiveness of the new delisting regulations will be concentrated.
Great Wall International Acg Co.Ltd(000835) 3 announced on March 24 that the company’s shares touched the terms of termination of listing on the Shenzhen Stock Exchange and were suspended from the opening of the market on March 25.
In addition to the ‘ Great Wall International Acg Co.Ltd(000835) , which is the Party of the Party ”’ 14companies, including Egls Co.Ltd(002619) , Northeast Electric Development Company Limited(000585) , Huaxun Fangzhou Co.Ltd(000687) , Boomsense Technology Co.Ltd(300312) , Tempus Global Business Service Group Holding Ltd(300178) , Zhengzhou Sino-Crystal Diamond Co.Ltd(300064) and others, have issued risk warning announcements that their shares may be delisted, which may involve financial delisting indicators and forced delisting.
According to China Securities News, “after the delisting system cancels the suspension of listing, the number of financial companies that are forced to delist in 2022 may increase significantly compared with the past.” Wei Wei, chief strategist of Ping An Securities, said that the new delisting rules streamlined the delisting process and shortened the delisting time from the original four years to two years. The 2020 annual report is the first applicable year of the new delisting rules. If the 2021 annual report touches the delisting standard again, it will be directly terminated.
In addition to the above financial index delisting and delisting case of one yuan, many listed companies have been questioned about avoiding delisting suspicion and have been inquired by the exchange. The risk of delisting is high.
Analysts believe that since the implementation of the new delisting regulations, various types of delisting cases have been increasing, and diversified delisting has entered a new stage.
“One yuan delisting and the number of financial index delisting have increased, which is the result of the continuous optimization of the delisting system. The exit channels of A-Shares are becoming more and more unblocked, and investors’ voting with their feet will further force the survival of the fittest and complete the self purification of the market. In 2022, many listed companies will be delisted due to triggering financial, trading, regulatory or major illegal delisting indicators.” Said Chen Lichuan, chief economist of the Securities Research Institute.
