On April 7, Red Sun issued an announcement on the progress of the investigation and risk warnings, stating that the investigation work of the China Securities Regulatory Commission is still in progress, and the company has not received any concluding opinions or decisions on the investigation matters of the China Securities Regulatory Commission. According to the relevant provisions of the “Shenzhen Stock Exchange Stock Listing Rules”, if the company is subject to administrative penalties by the China Securities Regulatory Commission and the violation is a major violation of mandatory delisting, the company’s stocks may be subject to the risk of being terminated from listing.
Information shows that Red Sun has been investigated by the China Securities Regulatory Commission for alleged violations of the letter and disclosure regulations for nine months. After the market on July 6, 2020, Red Sun suddenly announced that the company had received the “Investigation Notice” from the China Securities Regulatory Commission on the same day. According to the reporter’s understanding, if the China Securities Regulatory Commission finally imposes an administrative penalty on Red Sun after investigation, according to relevant judicial interpretations, it will be held at the close of April 29, 2020, and sold or held after April 30, 2020. And have incurred a certain floating loss (regardless of whether the set is resolved) or held it at the close of July 6, 2020, and sold or held after July 7, 2020, and has incurred a certain floating loss (regardless of whether the set is resolved or not) ) Investors can protect their rights through legal channels. Investors who meet the above conditions can also send their name, contact number and transaction records (Excel file is recommended) to the mailbox firstname.lastname@example.org to participate in the pre-collection of claims organized by the “Private Rights Protection” section of the “Securities Market Red Weekly” activity. The claimable scope of this pre-collection of claims includes investment differences, commissions, stamp duty losses, etc. The final compensation conditions and compensation amount will be determined by the court. Investors do not need to pay any attorney’s fees before receiving compensation.
The reporter learned from Tianyancha APP that before being investigated by the Securities Regulatory Commission, Red Sun had been exposed to the illegal occupation of the funds of the listed company by a major shareholder. On April 30, 2020, in the relevant operating performance and special descriptions disclosed by Red Sun, it stated that the company’s controlling shareholder Nanjing First Pesticide Group Co., Ltd. (including its related parties) had newly acquired occupations during the period from January to December 2019. Listed company funds were 4.684 billion yuan, and by the end of the year, there were more than 2.9 billion funds that had not been returned.
Regarding the reasons for the misappropriation of funds of listed companies, Red Sun stated that “in 2019, the downward pressure on the global economy will increase. With the continuous strengthening of the national deleveraging policy, especially the financial institutions dragging, borrowing, and pressing loans to private enterprises. The bank’s internal credit approval process has been lengthened, the time is uncertain, and open market financing has become more difficult. The secondary market has also fluctuated sharply due to the Sino-US trade war and deleveraging, which has led to liquidity risks for the company’s controlling shareholders and thus non-operating Occupy company funds for the return of other financing loans and interest, liquidity turnover, etc.”.
Tianyancha APP shows that Red Sun is an integrated upstream and downstream company with pesticides and three drugs and three drugs intermediates as the main business. It is mainly engaged in environmental protection pesticides, three drugs and three drugs intermediates, fine chemical products, and biomedicine. Production and sales and manufacturing and operation of packaging materials for pesticide products. The recently released annual performance forecast shows that Red Sun expects 2020 operating income from 4.02 billion yuan to 4.25 billion yuan; net profit attributable to shareholders of listed companies is 42 million yuan to 63 million yuan, an increase of 112.35% to 118.53% over the same period last year.
Reprint indicated source：Spark Global Limited information