Chinese economy continues to decline, with ongoing price wars and intensifying internal competition among companies. The performance of listed companies is deteriorating, with losses expanding. As of December 18, a total of 52 companies have been delisted from the A-share market, reaching a record high in years. Furthermore, 152 companies have been labeled with “ST” or “*ST” due to triggering delisting risk warning indicators.
“ST” is an abbreviation for Special Treatment in English, representing financial or other abnormal risk warnings for companies, and their stocks will not be directly delisted. “*ST” indicates that the stock has been issued a “delisting warning” and is already on the brink of delisting.
According to Wind data, as of December 18, a total of 322 companies have been delisted from the A-share market. Among them, the number of delisted companies in 2024 is 52, which is an increase of 7 from 2023, setting a new record high.
Before 2020, the average number of delisted companies on the A-share market was around 10 per year, but this number has increased significantly after 2020.
Out of the 52 delisted companies, 38 were delisted due to “stock trading below face value,” where the closing price of the stock for twenty consecutive trading days was below the face value of 1 yuan, representing a 90% increase year-on-year.
A financial magazine article in September of this year pointed out that 2024 has become a “1 yuan delisting” year. Among the delisted companies, 31 companies were delisted due to face value reasons, accounting for approximately two-thirds of the total. Apart from face value delisting, other reasons for delisting included continuous losses for four years, failure to disclose regular reports after suspension of trading, and major violations.
Wind data also shows that as of December 18, 2024, a total of 152 companies in the A-share market have been labeled with “ST,” an increase of 29.91% compared to the previous year.
An analysis conducted by a financial publication in August of this year revealed that most of the “delisted stocks” had previously raised billions to even tens of billions of yuan in the A-share market through financing. Despite substantial financing, these companies generally performed poorly, with over 90% of them having accumulated net profits after their listing lower than the financing amount raised in the A-share market. Some companies even ended up losing all the funds they had raised through financing over the years.
ST Aikang, since its listing in 2011, has raised funds three times, including IPO fundraising, accumulating a net amount exceeding 5.5 billion yuan from the capital market. In the second year of its listing, ST Aikang’s performance quickly turned negative, leading to accumulated net losses of nearly 3 billion yuan over its 13 years on the market.
In addition, while the number of IPO companies in the A-share market hit a new low since 2014, the number of terminated IPO companies rose to 428.
As per Wind data, as of December 18, 2024, a total of 95 companies have been listed on the A-share market, marking a 69.65% decrease compared to the previous year. This is the first time since 2014 that the number of IPO companies fell below one hundred.
Based on statistics disclosed by the Shanghai, Shenzhen, and Beijing stock exchanges, as of December 3, a total of 428 companies have undergone the process of terminated review (withdrawal of materials + rejection/termination of registration), including 150 on the Shanghai Stock Exchange (77 on the main board and 73 on the Sci-Tech Innovation Board), 202 on the Shenzhen Stock Exchange (54 on the main board and 148 on the Growth Enterprise Market), and 76 on the Beijing Stock Exchange.