Shang Hai Zheng Quan Bao·2025-08-16 11:23Core Viewpoint - Sichuang Medical's involvement in financial fraud has led to criminal investigations, with the company cooperating with authorities during the ongoing inquiry [1][3][4]. Group 1: Investigation and Legal Actions - Sichuang Medical received a notice from Hangzhou Public Security Bureau regarding evidence collection for a fraud case related to securities issuance [1]. - The investigation focuses on past financial records and is linked to previous administrative penalties imposed by the Zhejiang Securities Regulatory Commission [3][4]. - The company was previously found to have inflated revenue and profits significantly, with a cumulative revenue inflation of 34.93 million yuan and profit inflation of 33.02 million yuan in 2019, representing 20.03% of total profit for that period [4][5]. Group 2: Financial Performance and Adjustments - In 2024, Sichuang Medical reported revenues of 690.77 million yuan, a decrease of 31.33% from the previous year, while the net loss was 501.51 million yuan, a reduction in losses by 42.64% compared to 2023 [9][10]. - The company has undergone significant restructuring, including the resignation of its former chairman and the sale of its subsidiary, which was the main platform for the fraudulent activities, for 300 million yuan [7][8]. - Following the divestment, the company aims to focus on the Internet of Things (IoT) business, shifting its growth strategy to "focus on IoT, reshape growth engines" [8]. Group 3: Regulatory Environment and Future Outlook - The recent increase in criminal accountability for financial fraud in the industry is highlighted by the Supreme Court and the China Securities Regulatory Commission's joint guidelines aimed at enhancing regulatory scrutiny and penalties for fraudulent activities [10]. - Sichuang Medical is actively engaging with investors regarding potential compensation plans and is committed to fulfilling its legal responsibilities [6].