Author丨Xiao Xia
Editor丨Zhu Yimin
Nearly a week after the introduction of the new "National Nine Articles", the capital market gave strong feedback.
In response to the voice of investors, the new "National Nine Articles" and related supporting documents have put forward new requirements for the IPO, performance, delisting, dividends, and compliance operation of major shareholders of listed companies, which clearly proposes to increase the supervision of delisting, deepen the reform of the delisting system, and accelerate the formation of a normalized delisting pattern that should be withdrawn and cleared in a timely manner.
Some investors in small and medium-sized liquor stocks are very nervous: they just wanted to speculate on the theme of restructuring and take a dilemma reversal script, but they won't really be delisted now, right?
The original intention of the new regulations is to guide funds from theme speculation and shell resource stocks to high-performance stocks. Guo Ruiming, director of the Listing Supervision Department of the China Securities Regulatory Commission, pointed out in response to reporters' questions that the adjustment of the delisting index is aimed at increasing efforts to clear out the "zombie shells" and "black sheep", not for "small-cap stocks".
There are more than 40 listed companies in the A-share liquor sector, although there are giants like Kweichow Moutai with annual revenues of hundreds of billions, there are also a number of small and medium-sized liquor companies with mediocre long-term performance or even repeatedly jumping on the profit and loss line.
The 21st Century Business Herald reporter noticed that from April 15th to 18th, *ST Mogao, *ST Xifa, ST Tonglu, Zhongxin Niya, Huangtai Liquor, Qinghai Spring, Lanzhou Yellow River, Hainan Coconut Island and other liquor stocks have fallen to the limit, and the decline is generally about 15% to 20% during the week.
According to the supporting documents of the new "National Nine Articles", some of these wine companies may be ST faster, and the possibility of delisting of ST wine companies is also increasing. Some of these liquor stocks have also experienced shareholder infighting, shareholders being investigated, major shareholders violating guarantees, and misappropriation of funds in violation of regulations, making it difficult for the interests of small and medium-sized investors to be protected.
Looking back at the business history of these liquor stocks, it can be seen that the road to delisting is mostly paved by the companies themselves, and the new regulations are just pressing the fast-forward button.
The relevant provisions of the new "National Nine Articles" focus on the long-term business sustainability of enterprises and the feedback to investors. Photo by Chen Guoli
Small and medium-sized liquor stocks have fallen to the limit
The "Several Opinions on Strengthening Supervision and Risk Prevention and Promoting the High-quality Development of the Capital Market" (referred to as the "New "National Nine Articles") issued on April 12 is a special capital market guidance document issued after the two "National Nine Articles" in 2004 and 2014, and the China Securities Regulatory Commission and the stock exchange have also issued or revised relevant supporting documents.
Regarding delisting, the new "National Nine Articles" proposes to increase the supervision of delisting. Specifically, it includes further tightening the mandatory delisting criteria, improving the market value standard and other trading delisting indicators, tightening the financial delisting indicators, further reducing the value of "shell" resources, increasing the implementation of standardized delisting, strengthening delisting supervision, and increasing a series of measures such as serious fraud in one year and continuous fraud in delisting for many years.
Since April 15, many small and medium-sized liquor stocks have fallen to the limit. Among them, two *ST shares are of particular interest.
The share price of Gansu's long-established wine company *ST Mogao (600543.SH) reacted the most violently, falling for five consecutive days from April 15, falling 25% in a week. Its annual report disclosed on March 29 shows that its revenue in 2023 will be 198 million yuan and its loss will be 41.44 million yuan, although it has a significant decrease from the previous year, it is still its third consecutive year of loss.
*ST Mogao has no risk of delisting. According to the original "Stock Listing Rules" of the exchange, the performance indicator of the ST company is "negative net profit for two consecutive years, and the revenue is less than 100 million yuan". *ST Mogao's revenue reached the target last year, so it has applied for the cancellation of the stock delisting risk warning after the release of the annual report.
However, after the release of the new "National Nine Articles" last week, the exchange plans to increase the revenue target of loss-making companies on the main board from 100 million yuan to 300 million yuan. *ST Mogao's revenue last year was not up to standard.
However, there is a one-year "probationary period" for this policy.
According to the exchange's explanation, the main board financial "loss + operating income" combination indicator takes 2024 as the first fiscal year, and listed companies will continue to implement *ST, revoke *ST, or terminate listing in accordance with the provisions of the original rules for mandatory delisting of financial after the disclosure of the 2023 annual report, and the company that implements *ST will disclose the 2024 annual report next year, and then cancel *ST or terminate the listing in accordance with the new rules.
This means that if ST Mogao can take off the hat this year, it will no longer need to face the red line of "300 million yuan in revenue" for the time being. Otherwise, *ST Mogao's revenue needs to grow to more than 300 million yuan from this year.
For *ST Mogao, it is not easy to touch the red line of 300 million yuan, and its revenue of less than 200 million yuan in 2023 has increased by 83% compared with the previous year, which is the largest increase in the 20 years since its listing. The 21st Century Business Herald reporter noticed that the income of the three major products of wine, medicine, degradable materials and products increased significantly last year.
Not only has the revenue soared, but the gross profit margin of *ST Mogao's three major products has at least double-digit growth, which is also very rare in previous years. The 21st Century Business Herald reporter looked at the annual reports of *ST Mogao in the past five years, and only in 2019 there was a double-digit increase in the gross profit margin of wine, and the rest of the time it fell, and there was no sharp increase in the gross profit margin of the three major products at the same time.
The Shanghai Stock Exchange has not yet approved *ST Mogao's application to remove the hat, and issued an inquiry letter on the evening of April 16, requiring *ST Mogao to make supplementary disclosures on the large changes in business income and gross profit margin. The 21st Century Business Herald reporter tried to contact *ST Mogao, but multiple calls from the Secretary of the Board of Directors Office could not be connected.
*ST Xifa (000752.SZ), the company behind Lhasa Beer, is also on the verge of delisting, for different reasons: its net assets were negative in 2022, and it was issued an audit report by an accounting firm with a "no opinion".
*ST Xifa is expected to disclose its 2023 annual report on April 26, and will be terminated if its net assets are negative again. Its net assets in the third quarter of last year were still negative.
*ST Xifa is facing more than one delisting risk. Last year, the company entered the pre-reorganization stage, and both the company and the actual controller Luo Xi were investigated by the China Securities Regulatory Commission for illegal information disclosure, and have been involved in a number of equity- and asset-related lawsuits.
Delisting forced underperforming stocks
There are also three companies that were not under pressure to delist, and they are also suddenly one step closer to delisting.
Tinghua Liquor, which was just exposed by CCTV on March 15 last month, is behind Qinghai Spring (600381. SH) expects revenue of between 232 million yuan and 248 million yuan in 2023, with a loss of 222 million yuan to 287 million yuan, the fourth consecutive year of loss.
Lanzhou Yellow River (000929. SZ) just disclosed its annual report on April 17: revenue of 240 million yuan in 2023, a loss of 46.72 million yuan, a loss for two consecutive years. In addition, it continued to lose money in the first quarter of this year.
Zhongxin Niya (600084. SH) will have a loss of 880 million yuan in 2022, and it is expected that the net profit attributable to the parent company in 2023 will be positive, but the net profit after deducting non-attributable to the parent will be -13.5 million yuan to -11.8 million yuan.
The revenue of the three companies last year was less than the red line of 300 million yuan, and if the revenue still does not meet the target and continues to lose money in the next two years, it will be forced to delist.
Although there is no risk of delisting of other small and medium-sized liquor stocks that have fallen to the limit, their performance is not optimistic.
Another veteran wine company, ST Tonglu (600365.SH), lost money in 2022, and its loss in 2023 is expected to be 60.08 million yuan to 90.12 million yuan, which will be its second consecutive year of loss and the fourth loss in five years. Its original actual controller, Yin Bing, once violated the guarantee of nearly 270 million yuan, and was also ST because of this.
However, at present, ST Tonglu's annual revenue far exceeds the red line of 300 million yuan, and its net assets are also positive.
For many investors, trading underperforming stocks is mainly for shell resources, and once there is a restructuring theme, the stock price will increase significantly. Last year, ST Tonglu's share price rose by 40%.
However, the new "National Nine Articles" have set up more obstacles for capital speculation and backdoor restructuring.
On the one hand, the conditions for reorganization and listing have been revised, the supervision of reorganization and listing has been strengthened, the value of "shell resources" has been reduced, and the conditions for reorganization and listing of the main board have been raised in accordance with the revision of the listing conditions on the main board; on the other hand, the listing committee and the reorganization committee have also proposed to tighten the responsibility for examination and control, and strictly control the entry of issuance and listing, mergers and acquisitions, and reorganization, and the relevant committee members will be held accountable for life if they intentionally or grossly negligently violate the discipline of integrity in the performance of their duties.
The past business history of several other liquor companies that once fell to a halt proves that they are not injured by mistake.
Huangtai Liquor (000995. SZ), in the 24 years since its listing, it has been losing money for 11 years, and has been ST five times and five times off the hat, just turned around in 2022, and is expected to lose money again in 2023.
Hainan Coconut Island (600238. SH) has been listed for 24 years, of which 7 have been loss-making, and it has also been ST due to continuous losses, and reported losses again last year, and is expected to lose 110 million yuan to 130 million yuan in 2023, which will be its third consecutive year of losses.
Yang Delong, chief economist of Qianhai Open Source Fund, pointed out that the main purpose of the new "National Nine Articles" is to promote the deepening reform of the capital market, promote the transformation of market style, and let funds support good companies with good performance and promote economic transformation. This kind of company that has been losing money for many years in a row, has just taken off its hat and lost money again, is obviously not a high-performance stock that can lead the high-quality development of the capital market.
In addition, even if you use financial means to reverse the performance in a short period of time to achieve the removal of the hat, you still have to face stricter dividend requirements. The new regulations propose to take mandatory restraint measures for non-compliance with dividends, and companies that have not paid dividends for many years or have a low dividend ratio will also be ST.
It can be seen that the relevant provisions of the new "National Nine Articles" focus on the long-term business sustainability of enterprises and the feedback to investors. If the business philosophy cannot be fundamentally reversed, there will always be some underperforming stocks that will return to the "ghost gate" before delisting.
SFC
Editor: Liu Xueying, intern: Li Jie
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