Do you still remember Kangmei Pharmaceutical the year before last?
A white horse stock with a market value of more than 130 billion yuan has inflated revenue by 30 billion yuan and profits by 4 billion yuan in two years. It was punished by the China Securities Regulatory Commission and now has a market value of only more than 40 billion yuan. What was once a "white horse stock" suddenly turned into a "black swan", and hundreds of thousands of investors were trapped.
Just the day before yesterday, the China Securities Regulatory Commission issued the first fine in the Year of the Tiger. The former white horse stock, Shandong Fertilizer King Jin Zhengda, has been exposed to fraudulent financial reports spanning five years. According to the administrative penalty decision of the China Securities Regulatory Commission, in the three and a half years from 2015 to the first half of 2018, Kingenta falsely increased revenue by 23.073 billion yuan, costs by 21.084 billion yuan, and total profits by 1.990 billion yuan.
The China Securities Regulatory Commission fined 8 relevant responsible persons including Jinzhengda and its actual controller a total of 7.55 million yuan, and also adopted market ban measures. The then chairman Wan Lianbu was fined 10 years of market ban. .
Kim Zhengda’s problems start with the 2019 audit report.
On April 29, 2019, Daxin Accounting Firm issued a non-standard audit report on Kingenta’s 2018 financial statements. The audit report pointed out that the balance of Jinzhengda's advance payment to its related party Nobifeng was 3.714 billion yuan, and the goods had not been received as of the date of the audit report.
After a year, Daxin Accounting Firm once again issued a non-standard audit report on Kingenta’s 2019 financial statements. Since then, the Shenzhen Stock Exchange has implemented a "delisting risk warning" for Jinzheng, and will change it to "*ST Jinzheng" starting from July 1, 2020.
In this audit report, the issue of advance payment was pointed out again. The report pointed out that Kingenta recorded the amount of 2.845 billion yuan as advance payment for goods from related party Nobifeng, but Kingenta has not provided relevant reasonable information.
Since then, Jinzhengda issued an announcement that its related party Nobifeng will pay off its debts with capital. Nobifon agreed to transfer some of its assets to Kingenta to offset the advance payment. Involving real estate, production lines, patent transfer, etc., the assessed value is 1.08 billion yuan.
However, Nobifeng's operating conditions are not good. In 2019, the main business income was still 1.407 billion yuan. By 2020, the main business income has dropped sharply to 360 million yuan, with a net profit loss of 98.4663 million yuan. . Despite poor management and several billions of advance payments yet to be repaid, Kim Jingda had a "soft spot" for Nobifeng and has since had many related transactions with Nobifeng.
As of January 18, 2022, Kim Zhengda’s financial fraud has finally come to light, with a total of 23.073 billion yuan in inflated revenue, 21.084 billion yuan in inflated costs, and 1.990 billion yuan in total inflated profits. The actual controller, chairman, general manager Wan Lianbu and seven relevant responsible persons were fined a total of 6.05 million yuan.
In addition, according to the market ban decision letter, Chairman Wan Lianbu adopted a 10-year market ban measure, Deputy General Manager and Finance Chief Li Jiguo adopted a 5-year market ban measure, and the Finance Department Manager and Finance Manager Tang Yong, director of the center, adopted a three-year ban from the market.
At present, Kingenta’s market value is only 9.1 billion. From the high point in 2019, its performance has dropped by 60%+, and more than 70,000 shareholders are crying without tears.
Some professionals said that buying ST Jinzheng from March 29, 2016 to June 29, 2020 or buying ST Jinzheng from June 30, 2020 to September 14, 2020 , and damaged investors who still hold shares at the close of the corresponding range can claim their rights.
Jinzhengda once occupied an important position in the domestic compound fertilizer market, and its compound fertilizer production and sales volume once ranked first in the country.
At present, Kim Zhengda’s financial situation is improving. According to the annual performance forecast released on January 26, the company has significantly reduced its losses and its performance is expected to improve this year.