① This evening, Simei Media announced that the China Securities Regulatory Commission has decided to file a case against the company due to the company's alleged illegal disclosure of information. ② Simei Media said that the gross profit received by the company from the Douyin supermarket live broadcast room accounted for less than 0.5% of the company's total gross profit in 2022. ③ A lawyer at a certain firm said that this type of credit approval violation is generally mainly based on administrative penalties, and there are major technical barriers to investors defending their rights.
Financial News Agency, November 29 (Reporter Cui Ming) Simei Media (002712.SZ) faced a “penalty” for “running a Douyin supermarket on behalf of someone else.”
This evening, Simei Media announced that the China Securities Regulatory Commission has decided to file a case against the company due to the company's alleged illegal disclosure of information. On the same day, it was announced that the company and relevant personnel received a warning letter from the Zhejiang Securities Regulatory Bureau. Furthermore, in response to a letter of concern from the Shenzhen Stock Exchange today, Simei Media also stated, “Investors have misunderstood due to interactive responses and incomplete statements, which have caused large stock fluctuations. We sincerely apologize to investors.”
On the afternoon of November 27, Simei Media said in an interactive easy response to investors' questions, “The Douyin supermarket is currently operated by our company”, which attracted a great deal of attention from the capital market. Afterwards, a reporter from the Financial News Agency called Simei Media and Securities Department as an investor. Relevant sources said that the company mainly operates the Douyin supermarket for live streaming, such as participating in the construction of live broadcast rooms and recommendations from influencers, not including product selection. He also said that the incident began recently and had little impact on the performance of listed companies.
However, after the market closed on the 27th, Douyin e-commerce officially refuted the rumor, saying, “Online rumors that Simei Media operates the Douyin supermarket on its behalf. This is false news. The Douyin supermarket business is operated by Douyin E-commerce.”
Immediately after that, Simei Media also responded on Interactive Easy, saying, “What the company claims to operate the Douyin supermarket on its behalf means that the company operates one of the official live broadcast rooms of Douyin's official supermarket on its behalf.” The next day (November 28), the Shenzhen Stock Exchange issued a letter of concern to Simei Media requesting clarification on the details of the development of the Douyin Supermarket-related business.
In response to a letter of concern from the Shenzhen Stock Exchange, Simei Media explained in its response to the Shenzhen Stock Exchange's letter of concern that the first response failed to take into account that agency operations may involve non-advertising media, leading to misunderstandings among investors, while the second response defined the scope and meaning of the “agency operation” business in more detail and precision.
As for the “gold content” of the partnership with Douyin supermarket? Simei Media said that the cooperation between the company and Douyin supermarket will begin in September 2023, and that work will be carried out first based on the facts of customer data messages (no written agreement has been signed yet). The business scope of cooperation between the company and Douyin supermarket is agency operation services for a live broadcast room in the Douyin supermarket, that is, to set up a live broadcast room to help the Douyin supermarket sell its products and earn rebates through various sales methods such as streaming and live streaming.
Simei Media also said that the live broadcast room of the Douyin supermarket is only a very small branch of the Douyin supermarket business, and the scale and proportion of the business is very low compared to Douyin. “The gross profit received by the company from the Douyin supermarket live broadcast room accounted for less than 0.5% of Simei Media's total gross profit in 2022, which had little impact on the company's business.”
In the first three quarters of this year, Simei Media achieved revenue of 4.138 billion yuan, an increase of 33.74% over the previous year; a loss of 4.2876 million yuan, which turned into a loss over the previous year.
It is worth noting that information disclosure irregularities caused the company's stock price to “rise and fall sharply” in the past three trading days, and there was a wave of investors defending their rights over a period of time.
A lawyer from a certain firm told the Finance Association reporter that according to the securities law, this type of credit approval violation is generally mainly based on administrative penalties. “As far as the current situation is concerned, there are still shortcomings in the corresponding legislation and supporting judicial interpretations in the field of investor rights protection. For example, in the field of rights protection against insider trading, market manipulation, and major shareholders' breach of promises, there are sporadic cases where investors win lawsuits, but due to lack of judicial interpretation, there are no detailed regulations on how to determine the extent of investors' losses or how to calculate losses caused by investors due to such acts, and there are still major technical barriers to investor rights protection.”