Trainee reporter Wen Yan
On the morning of May 13th, *ST Xianfeng opened with a daily limit!
On the news side, *ST Xianfeng released a repurchase plan on the evening of May 12, intending to repurchase shares with its own funds of 50 million yuan to 100 million yuan, and the repurchase price does not exceed 2.2 yuan per share (inclusive).
*ST Xianfeng's above-mentioned move triggered a letter of concern from the Shenzhen Stock Exchange that night, requiring it to strictly abide by the relevant rules to implement the repurchase, and fully remind it of the risk of terminating the listing.
As of the close of trading on May 10, *ST Xianfeng's stock price was below 1 yuan per share for 5 consecutive trading days, and there was a risk of delisting if the stock closing price was lower than 1 yuan for 20 consecutive trading days.
The reporter inquired about the announcement and noticed that *ST Xianfeng has not released other repurchase plans since 2007, and the "pinching" release of relevant plans has been questioned by some investors whether it is a "flickering" repurchase, so as to avoid the risk of delisting.
"Pinch Point" launched a repurchase program
On the evening of May 12, *ST Xianfeng announced the repurchase plan: "It is necessary to maintain the company's value and shareholders' rights and interests, and it will be used for cancellation after the repurchase." ”
On the trading day before the release of the above-mentioned repurchase (May 10), the price of *ST Xianfeng was 0.78 yuan/share, which has been lower than 1 yuan/share for 5 consecutive trading days.
Article 9.2.1 of the Rules Governing the Listing of Stocks on the Shenzhen Stock Exchange (revised in 2024) stipulates that if the closing price of a company's shares is lower than 1 yuan for 20 consecutive trading days, the listing and trading will be terminated by the Shenzhen Stock Exchange.
According to the closing price of 0.78 yuan/share on May 10, *ST Xianfeng needs to continue to rise and fall for the next 6 trading days before the stock price can return to more than 1 yuan/share.
On the first trading day after the release of the repurchase plan (May 13), *ST Xianfeng opened with a daily limit of 0.82 yuan per share, and the upper limit of the stock price was further close to 1 yuan per share.
Industry insiders pointed out that after the stock price of a listed company is lower than 1 yuan / share, as long as the stock price stands at 1 yuan / share again, it is determined by the exchange to meet the delisting requirements of the face value, and the stock price needs to be recalculated for 20 consecutive trading days below 1 yuan / share, and the delisting risk may be further delayed.
Be wary of "flickering" buybacks and holdings
In the letter of concern, the Shenzhen Stock Exchange requested that *ST Xianfeng should implement the repurchase in strict accordance with the requirements of the relevant rules and effectively protect the interests of small and medium-sized investors.
Industry insiders suggest that most listed companies will be considered to be sending a message that is good for the stock price, but investors should be wary of risk warning companies that have relevant actions, whether in order to avoid the risk of delisting, and do not have the ability to complete the relevant plan.
Previously, some risk warning companies have issued repurchase or shareholding plans, intending to pull the stock price back to more than 1 yuan per share, or prevent the stock price from falling below 1 yuan per share, but the relevant plans have not been completed.
Taking Xinhai Retirement as an example, the actual controller and its persons acting in concert plan to increase their holdings of the company's shares by a total of 65 million shares to 70 million shares within six months from June 2, 2023, but as of December 2, 2023, the period expires, and as of December 1, 2023, a total of 11.545 million shares of the company will be increased.
On the occasion of the release of the above-mentioned shareholding increase plan, the Shenzhen Stock Exchange issued a letter of concern, requiring Xinhai to verify whether the relevant shareholding increase entity has the financial strength to complete the shareholding increase plan and whether the shareholding increase plan is achievable.
On June 1, 2023, Xinhai withdrew from the closing price of 0.97 yuan/share, and by the opening limit on June 2, 2023, the stock price returned to more than 1 yuan/share, and the closing price was 1.02 yuan/share, but it was delisted and delisted on April 18, 2024.
At present, *ST Xianfeng plans to use its own funds of 50 million yuan to 100 million yuan to repurchase shares this time. *ST Xianfeng announced that as of December 31, 2023, the company's financial investment amount was about 470 million yuan, monetary funds were about 146 million yuan, and the amount of its own funds exceeded 600 million yuan, with no long-term and short-term borrowings.
In response to some investors' questions about *ST Xianfeng's "flickering" repurchase, the reporter called the company's securities department, but as of press time, the other party did not answer the phone.
There is also a risk of financial delisting behind it
For small and medium-sized investors, risk warning companies need to be vigilant when issuing repurchase and shareholding increase plans, because they also involve a number of risks of termination of listing.
On April 29, 2024, *ST Xianfeng's shares were subject to a "delisting risk warning" and "other risk warning" by the Shenzhen Stock Exchange, mainly because its net profit attributable to the parent company in 2023 was negative, and the operating income after deducting business income unrelated to the main business and income without commercial substance was less than 100 million yuan, and the internal control audit report was issued with a negative opinion in 2023.
According to the special statement of Beijing Xinghua Certified Public Accountants (Special General Partnership) (hereinafter referred to as "Xinghua"), the matters involved in the non-standard internal control audit opinion of ST Xianfeng in 2023 include: recognition of revenue from accounts received in advance and inflated business income of large-scale pig farms.
Schmidt believes that as a result of the above-mentioned material deficiencies and their impact on the achievement of control objectives, *ST Xianfeng failed to maintain effective internal control over financial reporting in all material respects as at 31 December 2023 in accordance with the Basic Standards for Corporate Internal Control and related regulations.
The Shenzhen Stock Exchange reminds that if the operational, financial and internal governance conditions of ST Xianfeng do not improve significantly in 2024, its shares will be terminated after the disclosure of the 2024 annual report.
According to the relevant provisions of the "Shenzhen Stock Exchange Stock Listing Rules" (revised in 2024), if the company's annual report and audit report disclosed by the end of April 2025 show that the company's audited net profit in 2024 is negative and the operating income is less than 300 million yuan, the company's shares will be terminated from listing and trading by the Shenzhen Stock Exchange.
Editor: Captain
Review: Chen Siyang