Caixin
Nov 23, 2022 06:16 PM
BUSINESS

Chinese Mechanical-Equipment Maker Says Its Chair Faces Insider-Trading Probe

What’s new: Chinese mechanical-equipment maker Guangzhou Haozhi Industrial Co. Ltd. (300503.SZ) said its Chairman Tang Lijun is being investigated for insider trading by the national securities regulator, according to a Tuesday exchange filing.

Its Shenzhen stock price plunged 15.72% to 9.06 yuan ($1.27) apiece on Wednesday.

The Guangdong province-based company did not reveal details of the investigation, saying only that the case will not have a major impact on its business operations.

The context: Haozhi is a supplier of components for the production of numerically-controlled machine tools and industrial robots. In 2020, it acquired Swiss automation solutions provider Infranor for 33.4 million Swiss Franc ($35.1 million).

In August, the China Securities Regulatory Commission’s Guangdong branch criticized Haozhi for a series of problems with its balance sheet accounting and information disclosures, including failing to disclose its controlling shareholder’s misappropriating of company’s funds.

The company then corrected the financial statements for the first quarter and first half year of 2022 and 2021.

In the first nine months, its net profit attributable to shareholders dropped 79.8% year-on-year to 34 million yuan ($4.8 million).

Related: Sacked Head of Chinese Property Firm Claims Conspiracy Amid Insider Trading Allegations

Quick Takes are condensed versions of China-related stories for fast news you can use.

Contact reporter Guo Yingzhe (yingzheguo@caixin.com) and editor Bertrand Teo (bertrandteo@caixin.com)

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