Following the investigation initiated by the China Securities Regulatory Commission, Orient Group Incorporation and related personnel were warned by the Shanghai Stock Exchange. The company's stock price has suffered consecutive heavy losses recently, and it has fallen below the delisting threshold of RMB 1 for the first time today. According to a lawyer who spoke to reporters from Caijing Magazine, "We are currently gathering investors to protect their rights, and we have already collected more than ten investors."
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On June 24th, Caijing News reported that the Oriental Group (600811.SH) is currently experiencing a series of crises, starting with a large withdrawal limit of 1.64 billion yuan of deposits, the forced liquidation of some of the largest shareholders' holdings, being investigated by the China Securities Regulatory Commission, and a series of other crises. Tonight, because relevant information was not disclosed as required, the Oriental Group and relevant individuals were again warned by the Shanghai Stock Exchange.
Under the recent series of crises, the stock price of the company has continuously plummeted. Today, it fell below the 1 yuan delisting line for the first time. A lawyer interviewed by Caijing News said, "We are currently collecting investors to defend their rights. We have collected more than 10 investors so far, including one investor who has suffered losses of up to 700,000 yuan."
In the regulatory warning letter, the Shanghai Stock Exchange stated that according to the warning letter issued by the China Securities Regulatory Commission's Heilongjiang regulatory bureau to the company, in 2022, the Oriental Group and Heilongjiang Kanglongjiang Supply Chain Management Co., Ltd. (hereinafter referred to as Kanglong Supply Chain) had a procurement transaction of 359 million yuan, accounting for 1.85% of the company's latest audited net assets, and Kanglong Supply Chain is a related party of the Oriental Group. The above transaction constitutes a related-party transaction, and the company failed to perform the related-party transaction review procedure and information disclosure obligations as required.
As a result, including the Oriental Group, as well as the company's then chairman and president Sun Mingtao, and the then secretary of the board of directors Kang Wenjie, were all given regulatory warnings by the Shanghai Stock Exchange.
In fact, this is just a microcosm of the recent series of negative crises facing the Oriental Group. On the evening of June 18th, the company suddenly announced that the Oriental Group and its subsidiaries have had a large withdrawal limit of 1.64 billion yuan of deposits in its controlling shareholder's subsidiary, which opened the curtain on this round of Oriental Group crisis.
After the financial incident erupted, the actual controller of the company quickly issued a "Letter of Commitment on Resolving the Risks of the Financial Company." As the controlling shareholder of the Oriental Group Financial Co., Ltd. (hereinafter referred to as the "Financial Company"), the Oriental Group Co., Ltd. and its actual controller Mr. Zhang Hongwei will use asset disposal and other methods to support the Financial Company in resolving its liquidity and funding problems, and ensure the safety and liquidity of the listed company's deposits in the Financial Company. The Oriental Group Co., Ltd. and its actual controller expect the above-mentioned commitments to be completed within the next 3-6 months.
However, investors seem to be skeptical about this commitment, and the company's stock price has continued to decline, falling below the 1 yuan delisting line for the first time today. The company announced tonight: The closing price of the company's stock on June 24th, 2024 was RMB 0.90/share, which is lower than RMB 1. According to regulations, for listed companies that only issue A shares on the Shanghai Stock Exchange, if the daily closing price of the stock is below RMB 1 for 20 consecutive trading days, the company's stock may be delisted from the Shanghai Stock Exchange.
It is worth mentioning that after the China Securities Regulatory Commission filed an investigation against the company on June 21st, some lawyers have started to collect investors to defend their rights. Dong Fei, a lawyer with Beijing Guoshun law firm, told Caijing News, "We are currently in the stage of collecting investors to defend their rights, and the targets of the proceedings are investors who still held Oriental Group stocks at the end of trading on June 18th. We have collected more than 10 investors so far. One of the investors who suffered significant losses, lost about 700,000 yuan. Most of the investors who are defending their rights are currently quite rational. If the court finally determines that the Oriental Group made false statements, it will be regarded as a civil tort and reasonable compensation will definitely be required."
According to the financial report, Oriental Group has been losing money for three consecutive years, with a loss of 1.719 billion yuan in 2021, 996 million yuan in 2022, and a net loss of 1.557 billion yuan in 2023.