Yuancheng(SH:603388) Hua Xia Shi Bao·2025-10-12 01:10Core Viewpoint - The company ST Yuan Cheng (603388.SH) is facing a severe crisis due to financial fraud, leading to a potential delisting and significant penalties imposed by the regulatory authorities [2][7]. Financial Fraud and Penalties - The China Securities Regulatory Commission (CSRC) has identified that ST Yuan Cheng engaged in financial fraud from 2020 to 2022, resulting in a proposed total fine of nearly 80 million yuan, including 37.45 million yuan for the company itself [2][6]. - The fraudulent activities included inflating project costs and revenues, with a total of 1.58 billion yuan in inflated operating costs and 2.09 billion yuan in inflated revenues during the fraudulent period [3][5]. - The company’s financial reports for 2020, 2021, and 2022 showed inflated profits of 38.48 million yuan (36.60%), 11.09 million yuan (19.32%), and 0.886 million yuan (1.62%) respectively [3][4]. Regulatory Actions - The CSRC has classified the case as a serious financial fraud, triggering a mandatory delisting process due to the continuous nature of the fraud over three years [7][8]. - The regulatory body has indicated that any potential criminal elements will be referred to law enforcement agencies for further investigation [7]. Impact on Investors - Investors who suffered losses due to the financial fraud may file for compensation, as the penalties imposed on the company can be used to reimburse affected shareholders [2][11]. - The company has been in a state of continuous losses, with reported revenues of 294 million yuan, 274 million yuan, and 146 million yuan from 2022 to 2024, and a net loss of 66.49 million yuan in 2022 [9][10]. Market Performance - Following the announcement of the fraud and penalties, the stock price of ST Yuan Cheng dropped by 4.07% to 1.65 yuan per share, marking a cumulative decline of over 86% from its peak in December 2023 [9][10].