Jiangsu wuzhong(SH:600200) 2 1 Shi Ji Jing Ji Bao Dao·2025-12-02 07:56Core Viewpoint - The leading A-share medical beauty company *ST Suwu (600200) is facing forced delisting due to significant financial fraud, with its stock price plummeting over 90% this year, from over 9 CNY to below 1 CNY [1][4]. Financial Performance - As of the end of Q3, the company had nearly 68,000 shareholders, but its stock was suspended before the delisting announcement [4]. - Prior to suspension, *ST Suwu's stock had experienced five consecutive trading days of limit-up, closing at 1.24 CNY per share with a market capitalization of 8.81 billion CNY, although it had lost nearly 90% of its value compared to the same period last year [4][5]. Regulatory Actions - The Shanghai Stock Exchange issued a decision to terminate the listing of *ST Suwu due to major violations, following a penalty notice from the China Securities Regulatory Commission (CSRC) that identified false disclosures in annual reports from 2020 to 2023 [4][5]. - The CSRC's decision highlighted three main issues: concealing changes in actual control, severe financial fraud, and concealing fund occupation [6][7]. Financial Fraud Details - The company inflated its revenue and profits through non-commercial trade activities with related companies, resulting in inflated revenues of 4.95 billion CNY, 4.69 billion CNY, 4.31 billion CNY, and 3.77 billion CNY from 2020 to 2023, accounting for 26.46%, 26.39%, 21.26%, and 16.82% of reported revenues respectively [7]. - The total profit inflation during the same period was 145.83 million CNY, 20.27 million CNY, 19.92 million CNY, and 21.22 million CNY, representing 2.89%, 51.65%, 26.42%, and 29.81% of reported profits [7]. Corporate Governance Issues - The company failed to disclose a change in its actual controller in 2018, continuing to report the previous controller in annual reports until 2023, which severely impacted market transparency [6]. - The CSRC imposed a fine of 10 million CNY on the company and additional fines on responsible individuals, including a 1.5 million CNY fine and a 10-year market ban for the actual controller [8]. Business Challenges - Prior to the delisting, *ST Suwu faced multiple operational challenges, including warnings about potential delisting due to stock prices falling below 1 CNY [9]. - The company was involved in a dispute over exclusive sales rights for the AestheFill product, which further strained its financial performance [10][11]. - The ongoing arbitration regarding the AestheFill distribution rights has created uncertainty, impacting sales and leading to a significant revenue decline of 63.93% in Q3 2025 [11]. Industry Implications - The case of *ST Suwu serves as a warning to the medical beauty industry regarding the risks associated with agency models and the importance of compliance and transparency in financial reporting [12].