On April 24th, the Ji Drug Holdings Group Co., Ltd. (Ji Drug Holdings, *ST Ji Drug) announced that it has received a delisting notice for its stock. *ST Ji Drug has incurred a cumulative loss of 2.5 billion RMB over the 15 years it has been listed, with its stock price plummeting to 0.2 yuan.
The company disclosed on the 24th that it received a “Pre-notification Letter” issued by the Shenzhen Stock Exchange on April 24th.
The “Pre-notification Letter” stated that as of that day, for twenty consecutive trading days, the closing price of *ST Ji Drug’s stock had been below 1 yuan, triggering the termination of listing as stipulated in the Shenzhen Stock Exchange’s GEM-listed stock rules 10.2.1. The company’s stock will be delisted.
The announcement mentioned that the company’s stock will be suspended from trading starting on April 24th (Thursday). As of the close on April 23rd, the stock price was 0.21 yuan per share, down by 12.5%.
According to the GEM-listed stock rules, when a listed company’s stock meets the criteria for mandatory delisting and the Shenzhen Stock Exchange decides to terminate the listing, it does not enter a delisting period.
According to a report by “First Financial” on April 24th, since the stock price of *ST Ji Drug fell below 1 yuan on March 26th this year, it has been on a steady downward trend, with daily price declines exceeding 10% after April 16th, even hitting limit-down. On the last trading day of April 23rd, the company’s stock price plummeted by 12.50%.
As reported by “Daily Economic News” on April 25th, *ST Ji Drug had practically locked in its delisting fate on April 21st when the stock price fell to 0.30 yuan per share, the 18th consecutive trading day with a closing price below 1 yuan. In the following two days, the stock price continued to decline until it reached 0.21 yuan, with a total market value of 140 million yuan.
The company went public on August 25, 2010, and maintained a profit for eight consecutive years in terms of year-on-year and quarter-on-quarter comparisons. However, from the second quarter of 2019 onwards, the company fell into a state of continuous losses, with a sudden massive loss of 1.784 billion RMB in the fourth quarter of 2019, and has been in a state of losses ever since, with a substantial loss of profit for five consecutive years from 2019 to 2024, accumulating to 2.5 billion RMB, leading the company’s stock name to be prefixed with *ST.
“First Financial” believes that even if *ST Ji Drug does not delist due to the stock price falling below 1 yuan, it may still face forced delisting due to financial indicators.
*ST Ji Drug’s stock has been under delisting risk warning (*ST) since April 30, 2024. The performance forecast disclosed by the company on January 21, 2025, projected a year-end negative net assets of -1.18 billion to -0.83 billion RMB (unaudited). If the audited final net assets for the end of 2024 are negative, *ST Ji Drug’s stock will be delisted according to relevant regulations.
The company’s performance has continuously been in a state of loss since 2019, and the 2024 performance is also expected to incur a significant loss. According to the performance forecast, *ST Ji Drug expects a loss of 500 million to 850 million RMB in net profit attributable to the parent company for 2024.
Facing years of consecutive losses, debt defaults, lawsuits, and other factors, *ST Ji Drug has unsuccessfully attempted several times in recent years to transfer ownership of its shares.
According to data provider Wind data, five A-share listed companies have been delisted this year. Zhuolang Technology was forced to delist due to significant violations, Haitong Securities was absorbed and delisted through merger; *ST Meixun, *ST Boxin, *ST Dayao were delisted due to market value falling below standards.
Wind data also shows that there are currently 294 delisted stocks in the A-share market. Looking at the years in retrospect, before 2018, the number of delisted A-share companies each year was in single digits, starting to rise to 10 in 2019, and continuously increasing. By 2024, the number of delisted A-share companies reached a new high of 52.
Public information reveals that *ST Ji Drug is located in Tonghua City, Jilin Province, and its main business includes pharmaceutical industry (production of Chinese and Western medicine), pharmaceutical commerce (wholesale, agency), pharmaceutical retail, and medical care (ageing services combined with medical care) in the core health industry.