The in-depth investigation on La Chapelle by Shanghai Securities News three years ago has finally come true – Xinjiang La Chapelle Fashion Co.Ltd(603157) loses the ability of sustainable operation and will be delisted soon.
On March 30, Chunghsin Technology Group Co.Ltd(603996) , Xinjiang La Chapelle Fashion Co.Ltd(603157) released the annual report of 2021, which also announced its final outcome in a shares. Both companies received the advance notice and supervision letter issued by Shanghai Stock Exchange to terminate the listing of their shares due to triggering financial delisting indicators. Thus, Chunghsin Technology Group Co.Ltd(603996) , Xinjiang La Chapelle Fashion Co.Ltd(603157) have also become the first stocks in Shanghai stock market to touch the financial delisting index in 2022.
loss of ability to continue as a going concern
become the clearing object of the new delisting regulations
Chunghsin Technology Group Co.Ltd(603996) announced that the audited net profit of the company in 2021 was negative and the operating income was less than 100 million yuan, the audited net assets at the end of the period were negative, the financial and accounting report was issued with an audit report that could not express an opinion, and the company’s shares touched the situation of delisting Xinjiang La Chapelle Fashion Co.Ltd(603157) announced that its audited net assets at the end of the period in 2021 were negative, the financial and accounting reports were issued with qualified audit reports, and the company’s shares touched the situation of delisting. The trading of A-Shares of the two companies will be suspended from Thursday, March 31, 2022. The Shanghai Stock Exchange will make a corresponding decision to terminate the listing within 15 trading days.
Chunghsin Technology Group Co.Ltd(603996) was listed on the Shanghai Stock Exchange in December 2015. Its main business is the R & D, manufacturing and sales of smart electronic products such as smart TV, commercial display, notebook computer and tablet computer. Since 2019, due to the occupation of funds by related parties and illegal guarantee, the company has difficulty in financing and tight funds, the receivables of overseas customers cannot be recovered, the risk has erupted in an all-round way, the operating revenue has shrunk sharply, and even continuous losses have occurred. Since the beginning of 2020, the company has been in the state of shutdown, stagnation of main business and loss of sustainable operation ability.
Xinjiang La Chapelle Fashion Co.Ltd(603157) was listed on the Hong Kong Stock Exchange in October 2014 and on the Shanghai Stock Exchange in September 2017, becoming the first a + H clothing company. But after listing, the company showed a decline. After 2018, the company’s operating revenue continued to decline, stores contracted, asset sales and asset liability ratio increased year by year, and its performance suffered continuous large losses. Shanghai Securities News once made an in-depth investigation report in May 2019 (for details, see la Chapelle “makeup removal”: there are many abnormal financial data behind the contrarian loss). By 2020, the company’s risks will break out in an all-round way, with a sharp decline in performance and the closure of stores, involving a large amount of cumulative litigation. The company was affected by overdue debts, litigation, arbitration and execution cases, resulting in the freezing of several bank accounts, including the basic account, the sealing and freezing of the company’s assets and the equity of subsidiaries, and the serious impact on its production and operation business. At present, the company is insolvent, and there is significant uncertainty in its ability to continue operation.
On the whole, both companies have lost the ability of sustainable operation and become the clearing object of the new delisting regulations. In the A-share process of the two companies, the Shanghai Stock Exchange has conducted regular report inquiries for the two companies for many times, including continuous annual inquiries and multiple inquiries in a single year. It can be seen that the regulatory authorities have always paid high attention to the company’s risk situation.
companies with high delisting risk
exchange strictly implements the new delisting regulations
Previously, the Dea General Aviation Holding Co.Ltd(002260) , Great Wall International Acg Co.Ltd(000835) and Great Wall International Acg Co.Ltd(000835) of Shenzhen Stock Exchange touched on financial delisting, and Shenzhen Stock Exchange has issued a prior notice. The reporter noted that, in addition to the fact noted by the reporter that, as noted by the reporter that, in addition to the followingthe Dea General Aviation Holding Co.Ltd(002260) the2021 annual performance forecasts of many listed companies such as , Cred Holding Co.Ltd(600890) , 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) , Northeast Electric Development Company Limited(000585) , Egls Co.Ltd(002619) , etc, There is a possibility that the listing may be terminated due to financial delisting indicators.
The reporter learned that in order to urge listed companies and audit institutions to strictly implement the new delisting regulations, the Shanghai Stock Exchange has interviewed key companies and audit institutions for many times in the process of annual report audit supervision, and sent multiple audit risk reminder letters to audit institutions. In addition, the exchange also issued performance notice inquiry letters to a number of ST companies, especially focusing on whether there is any behavior of evading delisting, such as Guizhou Changzheng Tiancheng Holding Co.Ltd(600112) , Lawton Development Co.Ltd(600209) , Hubei Wuchangyu Co.Ltd(600275) , Jiangsu Chengxing Phosph-Chemical Co.Ltd(600078) , etc. In the face of serious regulatory inquiries, many companies delayed their reply, and a few companies that have replied also have the situation that accountants are unable to express clear opinions. Overall, although some companies claim that they will not touch the delisting situation in the performance forecast, there is still a high delisting risk, and investors must not take it lightly.
It is also noteworthy that at present, there is only one month left from the legal deadline for the disclosure of the annual report, and many companies have not yet hired an audit institution, and the annual report may face the risk of “dystocia”. Among the companies in Shanghai Stock Exchange, Xin Jiang Ready Health Industry Co.Ltd(600090) , Shangying Global Co.Ltd(600146) , Hubei Wuchangyu Co.Ltd(600275) have not employed an audit institution. According to the relevant provisions of the stock listing rules of the Shanghai Stock Exchange, if the company fails to disclose the annual report of the latest year within the legal time limit after being warned of delisting risk due to financial indicators, it will touch the situation of financial delisting.
Insiders pointed out that the new regulations on delisting have simplified the delisting process of financial delisting. In the first year, if financial indicators are touched, delisting risk warning will be implemented. In the second year, various financial indicators will be cross applied. If any indicator fails to meet the standard, it will be delisted directly. In this case, investors must not take chestnut from the fire.
