In the past year, St Huading has been in a lot of situations, such as shareholder infighting, goodwill impairment, controlling shareholders occupation and withdrawal of bad debts, sudden loss of performance, suspected illegal guarantee, suspected illegal borrowing and so on. According to statistics, in the past year, there have been 16 penalties for various violations, which have been repeatedly warned, criticized and denounced.
By the end of the first quarter of this year, there were 22300 shareholders in St Huading.
Two actual controllers of St Huading
Arrested and investigated for suspected crimes
St Huading announced that on August 10, he received a notice from the family members of Ding Zhimin, the actual controller, that Ding Zhimin was detained by the Yiwu Public Security Bureau for suspected fraud in obtaining loans, acceptance of bills and financial documents. The relevant issues need to be further investigated by the public security organs.
On August 10, Ding ermin, the actual controller of the company, informed the company that he had been investigated by Yiwu Economic Investigation for suspected illegal absorption of public deposits. The Yiwu Public Security Bureau issued a decision on bail pending trial to him, and decided to grant him a bail pending trial, with the period starting from August 8, 2020. The relevant issues need to be further investigated by the public security organs.
However, according to the announcement industry, Mr. Ding Junmin, the actual controller and chairman of the company, is currently performing his duties normally. Ding Zhimin and Ding ermin have not served as directors, supervisors and senior managers of the company. The above matters do not affect the exercise of shareholders rights of controlling shareholders and the normal business operation of the company. At present, the companys production and operation are normal.
Ding ermin, Ding Zhimin and Ding Junmin are the three brothers of St Huading actual controller. According to the public data, Ding Junmin is the youngest. In the 2019 annual report, Ding Zhimin and Ding ermin are both directors of the company, and Ding ermin is also the chairman of the company. However, at the beginning of July this year, they resigned from their positions as directors.
The king of ribbon and the second richest man in duty
20 billion assets are overwhelmed by 1 million debts
On May 9, 2011, Huading (now st Huading), a subsidiary of sanding holdings, was listed, becoming the first private listed company in Yiwu, Zhejiang Province. Ding Zhimin, Ding ermin and Ding Junmin became the second richest man in Yiwu.
On September 7, 2019, sanding holdings announced that due to the influence of multiple factors such as macro leverage reduction, bank credit contraction, and financing difficulties of private enterprises, the companys liquidity problems and great debt repayment pressure led to the companys failure to pay the repurchase principal and interest of 17 sanding 01 on time. The issue date of 17 sanding 01 is September 6, 2017, and the issuance scale is RMB 344 million.
At that time, sanding holdings also fell into the situation of more than 1 million defendants in arrears, which showed that the liquidity was very tight. The plaintiff company required sanding holding to pay the payment and interest on overdue payment.
Sanding Holdings has two sub groups: St Huading and sanding ribbon. By the end of 2018, the total assets of sanding holdings were 23.334 billion yuan, the net assets were 12.784 billion yuan, and the total debt was 10.054 billion yuan, including 7.63 billion yuan of interest bearing debt, and the asset liability ratio was 45.22%.
With more than 20 billion assets, most of them were inventory, investment in real estate and goodwill. Capital flow difficulties, debt can not pay, also implicated to the listed subsidiary st Huading.
Capital occupied by controlling shareholders
Suspected illegal guarantee and illegal borrowing
St Huading announced in the evening of July 30, 2020 that after self inspection, the companys controlling shareholder sanding holdings occupied a total of 579 million yuan of the companys funds, accounting for 12.67% of the companys latest audited net assets.
Up to now, the company has involved in the illegal borrowing amount of 259 million yuan and the illegal guarantee amount of 130 million yuan. Due to the suspected illegal borrowing and guarantee, the creditor filed a lawsuit against the company, involving a total amount of 199975000 yuan.
Asset acquisition explosion:
Impairment of goodwill and sudden loss of performance
Not only are the funds occupied by the controlling shareholders, but also the assets acquired before are explosive, resulting in a huge loss of 1.32 billion yuan in 2019. In 2019, St Huading achieved an operating revenue of 8.565 billion yuan, 29.71% year-on-year, and a total profit of - 1.226 billion yuan, with a year-on-year rate of - 441.71%. The net profit attributable to the parent company was - 1.321 billion yuan, which was - 606.31% year on year.
In 2019, the companys assets were impaired by RMB 969 million, mainly due to the goodwill impairment caused by the merger and acquisition of tongtuo technology; the loss of credit impairment was RMB 606 million, which was mainly caused by the single withdrawal of bad debt reserves of funds occupied by controlling shareholders in the current period.
On August 11, St Huadings share price fell again, falling 5.03% to close at 3.02 yuan. The latest total market value was 3.45 billion yuan. Since the high of 14.81 yuan in June 2018, the share price has dropped by about 80%, and the market value has evaporated from RMB 16.5 billion to RMB 13 billion.
There are 16 penalties for violations in one year
Wind information shows that in the past year, St Huading has been punished up to 16 times.
Investors worry that the stock price will continue to fall
On August 11, St Huadings share price fell to the limit. After the actual controller was arrested and investigated, investors worried that the stock price would continue to fall.
Source: China Fund News Editor in charge: Yang Bin_ NF4368