Hua Xia Shi Bao·2025-12-27 08:51Core Viewpoint - Long Pharmaceutical Holdings (ST Changyao) is facing a severe crisis due to financial fraud, leading to a potential delisting from the stock market and significant losses for its investors [2][4]. Group 1: Financial Fraud Details - Long Pharmaceutical Holdings has been found to have inflated its revenue by over 700 million yuan from 2021 to 2023, with specific annual increases of 215.32 million yuan, 283.74 million yuan, and 233.63 million yuan, representing 9.12%, 17.57%, and 19.51% of the reported revenue for those years respectively [4][5]. - The company also inflated its total profit by approximately 56.4 million yuan, 63.4 million yuan, and 43.7 million yuan during the same period, accounting for 35.62%, 88.23%, and 6.42% of the reported total profit [4][5]. - The fraud was facilitated by subsidiaries of Long Pharmaceutical Holdings, which created false inventory and sales documents without actual sales occurring [4][5]. Group 2: Regulatory Actions - The China Securities Regulatory Commission (CSRC) has issued a preliminary administrative penalty notice, proposing a total fine of 41 million yuan against Long Pharmaceutical Holdings and 14 responsible individuals, with the company itself facing a fine of 10 million yuan [5][6]. - The CSRC has classified the case as a serious financial fraud incident, indicating that it may trigger mandatory delisting procedures [5][6]. - The CSRC is also investigating the performance of the auditing firms involved, and any violations found will lead to further penalties [5][6]. Group 3: Investor Impact - Investors are facing dual risks of delisting due to financial indicators and serious violations, with the stock price having dropped over 70% in 2025, closing at 1.47 yuan per share [7][10]. - There are potential legal avenues for investors to seek compensation for losses incurred due to the financial fraud, particularly for those who held shares during specified periods [10][11]. - The company has acknowledged the situation and stated it will cooperate with the CSRC, but the final outcome will depend on the formal penalty decision [6][10].