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Cailianshe News on September 23 (Reporter Wu Chao): Three years after the 'Ye Fei Reporting Gate' incident broke out, Guangzhou Haozhi Industrial (300503.SZ), which was exposed to be involved in 'false market value management’, its involved personnel paid a heavy price.

According to the announcement, today Guangzhou Haozhi Industrial received a notice that the company's controlling shareholder, actual controller and chairman Tang Xiuqing, and director, board secretary, vice general manager, and CFO Xiao Yonglin received the CSRC's "Pre-Administrative Penalty Notification" (Penalty Letter [2024] No. 131), where Tang Xiuqing and Xiao Yonglin are accused of market manipulation. CSRC is planning to impose a fine of 0.109 billion yuan on Tang Xiuqing, and a fine of 2 million yuan on Xiao Yonglin.

Cailianshe reporters noted that in May 2021, Weibo influencer Ye Fei exposed that Guangzhou Haozhi Industrial and more than ten other listed companies colluded with private equity funds and other financial institutions to carry out 'market value management' and 'account settlement', manipulating stock prices using their financial and information advantages to illegally profit. When making the disclosure, Ye Fei posted on Weibo, 'Guangzhou Haozhi Industrial, you're the next target.' Ye Fei's comments attracted widespread attention and discussion from all sectors of society, as well as attention from relevant regulatory bodies.

In September 2021, not only was Ye Fei, who assisted in manipulating stock prices, arrested and brought to justice, but the actual controller of Guangzhou Haozhi Industrial Tang Xiuqing and his sister Tang Lijun, as well as the company's secretary Xiao Yonglin, were also successively investigated by the CSRC. After a lengthy investigation, Tang Lijun's insider trading behavior was confirmed in November last year, with the CSRC confiscating her illegal gains of about 2.45 million yuan, and imposing a fine of 4.9 million yuan, totaling approximately 7.35 million yuan. Tang Xiuqing and Xiao Yonglin, on the other hand, have faced official rulings from the CSRC today for their suspected market manipulation.

Public information shows that Guangzhou Haozhi Industrial is currently mainly engaged in high-end CNC machine tools, robots, core functional components for new energy vehicles and other businesses. In terms of operations, in the first half of 2024, Guangzhou Haozhi Industrial achieved revenue of 0.616 billion yuan, a year-on-year increase of 31.54%; net income attributable to shareholders was 54.9179 million yuan, compared to -14.8369 million yuan in the same period last year; attributable non-net profit was 30.4769 million yuan, compared to -26.8175 million yuan in the same period last year.

From the perspective of equity structure, Guangzhou Haozhi Industrial is a typical family business. As of the 2024 interim report, the company's top three shareholders are Tang Xiuqing, Tang Lijun, and Guangzhou Haoju, and prior to the 2023 interim report, the company's fourth largest shareholder was Tang Xiusong. Among these, Tang Lijun, Tang Xiuqing, and Tang Xiusong are siblings, while Guangxi Haoju is a company controlled by Tang Xiuqing.

Looking back at the stock price trend of Guangzhou Haozhi Industrial, it can be seen that its stock price experienced a significant increase from 2019 to 2020. Starting from the annual low point of 7.48 yuan per share on July 22, 2019, it reached 14.22 yuan per share at the close on March 9, 2020, almost doubling in less than 8 months. After March 2020, the stock price of Guangzhou Haozhi Industrial began the second round of upward trend, and on November 2, 2020, the stock price of Guangzhou Haozhi Industrial reached a high of 21.13 yuan per share. During these two "rising cycles" of stock price, Tang Xiuqing and its concerted action person Guangxi Haoju, related parties Tang Lijun and Tang Xiusong all conducted large-scale shareholding operations, cashing out billions of yuan.

However, on December 8, 2020, the stock price of Guangzhou Haozhi Industrial suddenly collapsed, hitting the 20% limit down on that day, and plunging over 13% the next day. It then entered a month of volatile downward trend, with the stock price dropping to the annual low of 9.11 yuan per share on January 13, 2021, losing more than half in just over a month, triggering market doubts about its "bearish market manipulation". Despite the company's repeated clarifications that the operation situation is normal, the sharp drop in stock price still caused investors heavy losses.

Financial commentator Zhang Xuefeng told Caixin reporters that manipulating the securities market would disrupt the fairness and impartiality of the market, harm the interests of other investors, and ultimately threaten the stability of the entire financial system, as abnormal fluctuations in stock prices may lead to the spread of investor panic and trigger market chaos. Therefore, manipulating stock prices in the name of market value management is illegal, and those responsible should be sanctioned by law. At the same time, it is also necessary to strengthen supervision, improve market transparency and standardization, and prevent similar events from happening again.