ST Baling's administrative penalty was "second confirmed" and the investor's claim range was clear

Since ST Baling (002592) received the CSRC's Administrative Penalty Decision on September 3, 2021, the Company and some parties applied to the CSRC for administrative reconsideration in accordance with the law because they were dissatisfied with the administrative penalties imposed by the Guangxi Securities Regulatory Bureau.

On February 10, ST Baling issued an announcement that it had recently received the "Administrative Reconsideration Decision" from the CSRC, and the CSRC would decide to uphold the administrative penalty imposed on the applicant by the respondent's Administrative Punishment Decision.

Previously, after the CSRC found that ST Baling had the following illegal facts, ST Baling acquired 51% of the equity of Beijing Hongrun Tianyuan Gene Biological Co., Ltd. (hereinafter referred to as "Hongrun Tianyuan") held by Wang Anxiang and its related parties in cash, and Wang Anxiang accepted 10% of the shares of ST Baling held by Yang Jingzhong. After the completion of the above transaction, Hongrun Tianyuan became a subsidiary of ST Baling Holdings, and Wang Anxiang became an associated natural person of ST Baling. Hainan Hongrun Tianyuan Gene Biotechnology Co., Ltd. (hereinafter referred to as "Hainan Hongtian") was established in October 2019 and is a wholly-owned subsidiary of Hongrun Tianyuan.

However, Hongrun Tianyuan had defective assets of 476 million yuan before it was acquired. In order to solve this problem, Wang Anxiang borrowed 296 million yuan and 170 million yuan from Hu Mouhuan on October 28, 2019 and January 8, 2020 to replace the above defective assets. However, due to Wang Anxiang's failure to arrange funds to pay off debts, all the 466 million yuan of deposits in the certificate of deposit were transferred by the pledgee, resulting in a major loss of funds of the listed company.

In the above matters, ST Balingsun Company Hainan Hongtian has not been subject to the review procedures of the listed company, which constitutes a guarantee in violation of the law. Wang Anxiang illegally used the funds of the listed company to provide financial assistance for his personal loans through collusion with others, resulting in the transfer of the listed company's resources and obligations, constituting a related party transaction and forming a non-operating capital occupation by a related party. For the above matters, ST Baling did not disclose them truthfully in the 2019 annual report and the first quarterly report of 2020.

Based on the above illegal facts, the Guangxi Securities Regulatory Bureau decided to order ST Baling to make corrections, give a warning, and impose a fine of 2 million yuan; give a warning to the controlling shareholder Wang Anxiang and four other relevant responsible persons, and impose fines ranging from 1 million yuan and 2 million yuan respectively.

The reporter learned from Lawyer Liu Peng of Shanghai Huzi Law Firm that the Nanning Intermediate Court made a first-instance judgment on some ST Baling Securities misrepresentation cases, and the investors won. The court held that there was a causal relationship between ST Baling's misrepresentation and the investor's loss, and the company should bear the liability for compensation for the investor's loss.

According to the judgment result, the court clarified the implementation date, disclosure date and base date of the misrepresentation in the case, so the claim range of ST Baling is that investors who bought ST Baling between April 30, 2020 and May 22, 2020, and sold or still held the stock after hours on May 23, 2020 and lost money, can register through the public account "Public Securities News" (feature code: 11011) to participate in the claim collection, and the lawyer will claim compensation from the company on behalf of the investor according to the specific circumstances.

In terms of performance, on January 29, ST Baling issued a performance forecast saying that the company expects the net profit attributable to the mother from January to December 2021 to be about 17 million yuan to 25.5 million yuan, compared with a loss of 685.1934 million yuan in the same period last year, an increase of 102.48% to 103.72% year-on-year.

Analysts pointed out that ST Baling's performance tends to be good, which is conducive to late-stage investor claims.

Reporter Li Yan