*ST Zhengping Suspended for Investigation, Warning of Ten Risks

On the evening of March 26, *ST Zhengping (603843) announced that the company’s stock price has increased by a total of 57.56% from March 10, 2026, to March 26, with limit-ups on 10 trading days, three instances of abnormal trading fluctuations, and two consecutive occurrences of similar abnormal fluctuations, increasing trading risks in the secondary market. To protect investors’ interests, the company will conduct an investigation into the trading activity. The company’s stock will be suspended starting from the opening of trading on March 27 and will resume trading after the investigation announcement is disclosed, with an expected suspension period of no more than five trading days.

The reporter notes that *ST Zhengping has not been suspended for investigation for the first time. Between October and November 2025, the company announced three times that its short-term stock price increases significantly deviated from the Shanghai Composite Index and the construction industry, leading to trading suspensions for investigation.

According to the announcement, *ST Zhengping has highlighted ten related risks, involving trading risks, delisting risks, pre-restructuring, capital occupation, mining capacity, and mining rights, among others.

Regarding trading risks, the announcement states that *ST Zhengping’s stock price surged too rapidly in a short period, severely diverging from its fundamentals, with high accumulation of trading risks. Investors are advised to invest rationally and be aware of investment risks.

Regarding delisting risks, *ST Zhengping warns that as audit work progresses, there is a risk that further adjustments could result in negative net assets. The company’s net assets are expected to be significantly lower than previously disclosed, with the lower bound estimated to be negative, indicating a major delisting risk.

Specifically, the company disclosed a revised earnings forecast on March 4, lowering the expected net asset range to between -30 million yuan and 90 million yuan by the end of 2025.

Additionally, the company faces significant delisting risk due to the issuance of a non-standard audit opinion. As of now, the annual auditor has not obtained sufficient and appropriate audit evidence to confirm that the issues preventing an unqualified opinion in the 2024 audit report have been resolved. If sufficient evidence cannot be obtained in the future, the company is expected to issue a non-clean opinion for 2025 financial statements. The company’s stock may trigger delisting provisions and face the risk of termination of listing.

Furthermore, the internal control audit report for 2024 was issued with a negative opinion, citing deficiencies in internal controls related to suppliers and project management, fund activities, legal affairs, and issues such as 190 million yuan of raised funds not being returned in a timely manner. If the 2025 internal control audit report also receives a negative opinion or cannot express an opinion, the stock will also face delisting risks under relevant regulations.

Regarding pre-restructuring, *ST Zhengping indicates that the debt declaration for pre-restructuring is partial, with some controlling subsidiaries not included in this debt declaration scope, leading to significant uncertainty about the accuracy and completeness of the debt declaration. The company may find it difficult to resolve issues related to non-standard opinions through this process.

Secondly, whether the company can enter the restructuring process is uncertain. The initiation of pre-restructuring by Xining Intermediate Court does not mean the company has officially entered the restructuring process. The company has not yet received legal documents related to the acceptance of the restructuring application. The acceptance of the application and subsequent restructuring are uncertain. Even after entering pre-restructuring, the company may still find it difficult to resolve issues related to project costs, external borrowing measurement, and other deficiencies.

Thirdly, there is uncertainty regarding the recruitment of restructuring investors. There is a risk that qualified investors may not be recruited or that investors may not sign investment agreements on time.

Regarding capital occupation, *ST Zhengping states that the annual auditor cannot confirm whether there are other undisclosed non-operating capital occupations or illegal guarantees. The company does not rule out the possibility of such situations and advises investors to be cautious.

On mining capacity and mining rights, *ST Zhengping notes that although its wholly owned subsidiary Geermu Shengguang Mining Development Co., Ltd. has obtained a mining license issued by the Qinghai Provincial Department of Natural Resources, its extraction capacity is insufficient. Future development of mineral resources will require large-scale investment in construction and operation, but the company currently lacks sufficient funds, personnel, and equipment for subsequent mining. The progress and profitability of mineral resource development are highly uncertain. Due to factors such as funding, market environment, industry policies, external conditions, and personnel shortages, the development progress and profitability are uncertain.

*ST Zhengping also faces the risk of mining rights being frozen. The announcement shows that its wholly owned subsidiary Shengguang Mining has entered litigation over a transfer contract dispute with the Qinghai Provincial Geological Exploration Bureau. During the litigation, the bureau may apply for property preservation measures on the mining rights to secure its claims; if the court issues such an order, the rights may be restricted or frozen. If legal procedures proceed accordingly, there is a possibility that the rights related to the mining rights could be legally disposed of.

Public information indicates that *ST Zhengping is mainly engaged in infrastructure construction, integrated development of cultural tourism and industry, and non-ferrous metal mining. To cultivate new growth points, the company is actively expanding into new businesses such as renewable energy construction and intelligent computing services.

In 2025, *ST Zhengping expects to achieve operating revenue of 950 million to 1.35 billion yuan, with a net profit attributable to shareholders of -430 million to -340 million yuan. In 2024, the company reported revenue of 1.362 billion yuan and a net loss of 484 million yuan.

*ST Zhengping states that due to liquidity constraints, it has defaulted on some debts and incurred significant management and default interest expenses due to related lawsuits. Under the pressure of industry changes and internal cash shortages, new business development is limited, existing projects have low startup rates, and some clients are also under financial pressure, delaying project measurement and payment, which has increased impairment provisions on contract assets and accounts receivable.

(Source: Shanghai Securities News)