On July 17, Guanghui Auto opened with a downward limit, falling by 10.34% to a closing price of 0.78 yuan per share. This day marked the critical 20th trading day for Guanghui Auto’s “delisting decision”.
According to a report from “First Financial” on July 17, from June 20 until now, Guanghui Auto’s stock price has remained below 1 yuan for 20 consecutive trading days, potentially triggering the delisting provisions based on face value.
Under the relevant regulations, if a company’s stock price closes below 1 yuan (RMB) for 20 consecutive trading days, the company’s stock may be delisted by the Shanghai Stock Exchange.
Previously, Guanghui Auto has tried various methods to turn the tide, including repurchasing company stock and transferring control rights. Although these methods have had some impact on the stock price, they have not been successful in helping Guanghui Auto to escape the risk of delisting.
According to Guanghui Auto’s profit forecast, the company expects a net loss of 583 million to 699 million yuan attributable to shareholders of listed companies for the first half of 2024.
Public records show that Guanghui Auto was established in 1999 and is a subsidiary of Guanghui Group. It is one of China’s largest car dealers, with a market value exceeding 100 billion yuan at its peak. As of December 31, 2023, Guanghui Auto operated a total of 735 business outlets, including 695 4S stores.
As reported by “Everyday Economic News”, despite the large scale of the company, its profit situation in recent years has not been particularly ideal. In 2022, the company had a net loss of over 2.6 billion yuan, while in 2023, it made a profit of 392 million yuan.
Guanghui Auto stated that market consumption downgrading, intensified industry competition, and major car companies engaging in price wars to capture market share have all led to a decrease in the company’s new car sales volume and gross profit margin compared to the same period last year.