The actual controller was investigated for suspected insider trading, Redick's fundraising plan failed, and the stock price fell sharply after a 20CM limit

Reporter | Wu Zhibang

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In recent times, law enforcement departments have cracked down more and more severely on the securities violations of the directors and senior supervisors of listed companies. Redick (300652. SZ) disclosed on the evening of October 31 that the company held the eighth meeting of the third board of directors and the eighth meeting of the third board of supervisors on October 31, 2021, deliberated and passed the "Proposal on Terminating the Issuance of Shares to Specific Targets", and decided to terminate the issuance of A-shares to specific targets.

According to Redick pointed out in the announcement, the reason why the long-planned fundraising plan was stopped is mainly because shen Renrong, the actual controller, chairman and general manager of the company, was investigated by the CSRC for suspected insider trading. Decided to terminate the issuance of shares to specific targets.

According to public information, Shen Renrong currently directly holds 7.02% of the equity of Redick, and Beijing Kejian Holdings Co., Ltd., Beijing Siquan Enterprise Management Co., Ltd., Beijing Fuyuntong Enterprise Management Co., Ltd., and Yu Caijun are its co-actors. As the founder of Redick, he led the company to a successful landing on the GEM in 2017 and has been in control of the company and has won many honors. For example, he was awarded the "Top Ten Advanced Individuals in Entrepreneurship and Innovation in Xiaoshan Economic and Technological Development Zone in 2011" and was rated as "the first outstanding part-time professor of Xingzhi College of Zhejiang Normal University".

Judging from Redick's financial data, in the first year of listing in 2018, the company's deducted non-net profit hit a new high, and has since shrunk all the way. However, judging from the situation in the first three quarters of 2021, the company's overall profit level has begun to increase significantly again. According to the third quarterly report, the company's non-net profit in the third quarter reached 28.4734 million yuan, an increase of 62.52% over the same period last year, and the deduction of non-net profit in the first three quarters of the whole period increased by 49.90% over the same period last year. The company once pointed out in the semi-annual report that the company's customer structure was further optimized, the demand for the customer market was strong, the company's sales orders grew rapidly, and the increase in product sales was caused by the company's main business showing a continuous growth trend.

It was in order to meet the subsequent developments that Redick also launched the progress of the non-public offering of shares. According to the prospectus (registration draft), the total amount of funds raised by the company to issue shares to specific targets shall not exceed 400 million yuan, and the net amount of funds raised after deducting the relevant issuance expenses intends to invest in truck clutch separation bearing construction projects and information construction projects.

According to the introduction, the truck clutch separation bearing construction project is an extension of the construction project of the wheel hub tapered roller bearing construction project of the convertible bond fundraising project, adhering to the company's development path from after-sales to the main engine market, passenger cars to commercial vehicles, and will further enrich the company's bearing products after the project reaches production. In addition, the implementation of the project is conducive to alleviating the problem of insufficient capacity supply faced by the company due to the increase in business volume, meeting its growing business needs, and providing productive supply support for the company to further seize market share and achieve sustainable development. According to the company's estimates, after the project is fully completed, it is expected to increase the total profit by about 68.6881 million yuan.

Judging from Redick's market performance, the company's stock price changed significantly in the trading days before Shen Renrong was disclosed to have been investigated by the CSRC for insider trading. Among them, on October 28, the company's stock price rose by 20%, Huaxin Securities Co., Ltd. Shanghai Branch, Dongguan Securities Beijing Branch and two institutional special seats ranked in the top four of the buy list, and the Dragon and Tiger list showed a trend of large net inflow of funds. However, Redick exploded a big thunder on the evening of October 28, and on October 29, the company's stock price fell by 10.01%, trapping the high funds.

Now that Redick's fundraising plan has also been suspended, how will the company's future stock price be interpreted? Have these high-level funds gone all the way back?