Trading resumed with a drop of over 70%, and Cubic's delisting is imminent

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China Business Journal reporters Gu Mengxuan and Li Zhenghao, reporting from Guangzhou and Beijing

After being “delisted with a star and a cap,” Cubic Retiree (300344.SZ) has entered the final delisting cleanup period. On March 30, Cubic Retiree issued an announcement stating that the company’s stock will resume trading on March 31, 2026 and enter the delisting cleanup period. The delisting cleanup period will last 15 trading days, and the company expects the final trading date to be April 21, 2026.

The announcement also points out that there will be no limit on upward or downward price movements on the first day of the delisting cleanup period; thereafter, the daily price movement limit will be 20%. During the delisting cleanup period, the company’s stock will not plan or implement any major asset restructuring. On the next trading day after the delisting cleanup period expires, the company’s stock will be delisted and its listing will be terminated. Subsequently, it will be transferred to the delisting board of the National Equities Exchange and Quotations (NEEQ) for transfer.

After resumption of trading, investors are paying close attention to Cubic Retiree’s stock price performance. Data from Wind shows that on March 31, Cubic Retiree’s stock price fell by 73.26%, and on April 1, it continued to decline by nearly 20%.

After reviewing the Eastmoney Stock Bar App, a reporter found that some investors in Cubic Retiree have been complaining in the stock bar. In response, experts remind investors that they can use legal means to safeguard their rights.

Regarding Cubic Retiree’s alleged financial fraud and related circumstances surrounding its imminent delisting, a reporter from China Business Journal called Cubic Retiree and sent an email. However, as of the time of the reporter’s submission for publication, the company has not responded.

Multiple links out of control

Regarding the sharp drop in Cubic Retiree after resumption of trading, Tian Lihui, dean of the Institute of Financial Development at Nankai University, told reporters that the plunge on the first day of the delisting cleanup period is a rational market reaction to the stock’s intrinsic value becoming zero.

Specifically, Tian Lihui said: First, it is due to institutional arrangements. On the first day of the delisting cleanup period, there is no limit on upward or downward price movement, so the accumulated sell pressure can be released in a concentrated manner. Second, it is due to a reappraisal of value. Since the company was forced to be delisted after three consecutive years of financial fraud, its stock has lost its trading value and financing function as a listed company, and its fundamentals have fundamentally deteriorated. Third, it is due to a liquidity discount. After delisting, the stock will move to the National Equities Exchange and Quotations’ “old Third Board” trading, liquidity will drop significantly, and investors need to compensate for this risk with a larger discount.

Wan Li, a researcher at Jinan Research Institute, told reporters that from the logic of the capital market, the plunge on the first day of the delisting cleanup period is not only an emotional reaction; it is also a simultaneous revaluation of two factors: first, after the loss of listing status, liquidity and financing capability decline significantly; second, financial fraud weakens the credibility of historical financial statements. “Therefore, this large drop is essentially the combined result of delisting risk, information disclosure non-credibility risk, and liquidity discount,” Wan Li said.

On February 14, 2026, Cubic Retiree received the “Administrative Penalty Decision” issued by the Anhui Securities Regulatory Bureau. After investigation, the following illegal facts were found to exist in the company: First, by conducting agency business, the company inflated operating revenue and operating costs. Second, by conducting financing-related trades, the company inflated operating revenue and operating costs. Third, by conducting false trades, the company inflated operating revenue, operating costs, and total profit.

The “Administrative Penalty Decision” shows that Cubic Retiree, by inflating operating revenue, operating costs, and total profit through agency business, financing-related trades, and false trades, caused the company’s disclosures in its annual reports for 2021 through 2023 to contain false records.

Among them, in 2021, the company inflated operating revenue by 280 million yuan, accounting for 50.09% of that year’s operating revenue; inflated operating costs by 277 million yuan, accounting for 60.61% of that year’s operating costs. In 2022, the company inflated operating revenue by 311 million yuan, accounting for 51.67% of that year’s operating revenue; inflated operating costs by 305 million yuan, accounting for 53.54% of that year’s operating costs; inflated total profit by 510.4 thousand yuan, accounting for 0.33% of the absolute value of that year’s total profit. In 2023, the company inflated operating revenue by 45.8694 million yuan, accounting for 24.00% of that year’s operating revenue; inflated operating costs by 45.2279 million yuan, accounting for 27.55% of that year’s operating costs.

Lawyer Pang Shanshan, a partner at Beijing DeHeng Law Offices, pointed out to reporters that the above illegal conduct by Cubic Retiree reflects serious gaps in the company’s corporate governance, internal control, and business ethics.

Pang Shanshan added that the current fraud involves 10 senior executives including Chairman Wang Yi, indicating that the company’s governance structure is effectively a mere formality. The board of directors failed to perform its management duties, and the board of supervisors failed to perform its supervisory duties. Not only did they fail to act diligently and responsibly, they instead became the planners and implementers of the fraud.

“Meanwhile, the company’s financial internal controls have also completely failed. In key areas such as revenue recognition, fund management, and contract approval, everything was entirely out of control. At the same time, external audit failed to play its role. The accounting firm Zhongxing Cai Guanghua Certified Public Accountants, which issued an audit report for Cubic Retiree with an audit opinion, has been formally filed for investigation by the CSRC,” Pang Shanshan said. She added that if the external audit had been able to detect issues earlier, it would not have reached today’s situation.

Wan Li told reporters that what such cases expose is that the company placed “making the scale of financial statements bigger” ahead of “truly reflecting operating conditions.”

Wan Li pointed out that for listed companies, the most dangerous thing is not short-term performance fluctuations, but that to maintain market expectations, financing expectations, or stock price expectations, they gradually slide into packaging income and profits using transactions that are not real. This will turn business problems into information disclosure violations, and ultimately turn corporate governance issues into delisting issues. “For Cubic Retiree to reach today, it precisely shows that once the principle of authenticity is breached, the consequences will not stop at the income statement, but will directly erode listing eligibility,” Wan Li said.

Disrupting the order of the capital market

Speaking about the criminal conduct of Cubic Retiree and its impact on the company itself and the capital market, Wang Huaitao, chief lawyer at Xingu Law Firm, told reporters that in terms of the company itself, this fraud directly resulted in a fine of 10 million yuan and also triggered the major-violation mandatory delisting red line. The hard-earned money of nearly 40,000 retail investors will suffer huge losses.

From the perspective of market impact, this incident severely undermined the integrity foundation of the capital market. The company once promoted itself with the banner of an “AI server dark horse.” Its stock price surged from around 3 yuan to 15.26 yuan, attracting a large number of retail investors to chase the rise and buy. When the truth surfaced, the stock price crashed, and the wealth of countless investors turned into nothing.

“More seriously, this fraud also affected other market participants,” Wang Huaitao said. Zhongxing Cai Guanghua Certified Public Accountants, which issued standard unqualified audit opinions for Cubic Retiree for three consecutive years, has been filed for investigation by the CSRC. In the short term, nearly 70% of its A-share clients have “terminated” their contracts with it. Its reputation and business have been severely impacted.

At the macro level, Wang Huaitao said that such fraud seriously damages investors’ trust in information disclosure by listed companies, disrupts the normal order of the capital market, and harms the market mechanism of survival of the fittest. The regulatory authorities’ resolute eradication of such “tumors” is precisely intended to maintain fairness and justice in the capital market and to rebuild investor confidence.

Tian Lihui told reporters that for the company itself, financial fraud directly leads to the termination of listing qualification. The company, which had once had a market value of tens of billions, has fallen from a listed company into a delisted enterprise. Its reputation collapses, and its financing channels are shut.

For the capital market, Tian Lihui believes the harm is reflected in three levels: first, it erodes the market’s credit foundation, as false financial reports mislead investors’ resource allocation decisions; second, it distorts the pricing mechanism, as valuation signals formed on fraudulent data become distorted; third, it increases trading risks, forcing about 38,000 shareholders to bear delisting losses. “This case also sends a clear signal: major violations lead directly to delisting, not to keeping listing status after rectification,” Tian Lihui said.

How do regulatory bodies typically detect illegal conduct by listed companies?

Tian Lihui told reporters that regulatory investigations into financial fraud have formed a set of penetration-style identification systems. First, through big data screening of abnormal trading patterns—such as indicators like long-term divergence between revenue and cash flow, and abnormal fluctuations in gross profit margins—early warnings are triggered.

Second, tracing the closed-loop of fund flows. In this case, regulators discovered self-circulating paths of contracts and funds by penetrating bank transaction records. Third, verifying the business substance of transactions. They interviewed upstream and downstream parties, checked records of transfer of title to goods, and confirmed that the company does not bear inventory risks and does not have independent pricing power, thereby determining that it acted as an agent rather than the main responsible party. Finally, administrative investigations and audit regulation are linked. The accounting firm that issued standard unqualified opinions for three consecutive years for the company has been filed for investigation.

Wan Li told reporters that from an institutional perspective, regulators’ identification of financial fraud usually does not rely on a single clue. Instead, it is the combined effect of on-site inspections, off-site monitoring, information matching, and verification of external clues.

From practical experience, Wan Li said that regulators typically have several discovery paths: first, abnormal identification during annual report review inquiries and continuous supervision, such as obvious divergence in operating revenue, gross profit margin, accounts receivable, cash flow, and comparisons with peers; second, on-site inspections and special verification, directly checking contracts, vouchers, warehousing, logistics, and relationships across upstream and downstream; third, problems exposed during audits or verifications by intermediaries, especially anomalies in revenue recognition, trade background, and unusual confirmation responses; fourth, tips, media questions, and market clues—these often become entry points for regulators to initiate deeper investigation. Wan Li pointed out that although the publicly released materials in this case do not disclose exactly which clue regulators initially took as the starting point, based on the reasoning style of the final penalty decision, the core remains focused on the substance of transactions and the legality of accounting treatment.

Multiple ways to claim compensation

An interviewee told reporters that similar to previous situations, because Cubic Retiree’s financial fraud led to delisting, investors can still take up legal weapons to initiate claims.

Pang Shanshan told reporters that, according to the Securities Law and the Supreme People’s Court’s provisions on handling civil compensation cases for false statements in the securities market, false records in financial data disclosed by listed companies should be identified as false statements.

Pang Shanshan said that if false statements cause losses to investors, the parties bearing compensation responsibility include: the listed company, the controlling shareholder, the actual controller, the suppliers and customers of the listed company, and financial institutions that provide services to the issuer, among others. When the above parties are at fault regarding the false statements made to the listed company, they will bear liability for investors’ losses.

Wang Huaitao told reporters that, according to the Securities Law and relevant judicial interpretations by the Supreme People’s Court, when investors’ rights and interests are harmed due to securities false statement conduct by a listed company, the listed company should bear civil liability for compensation. In this case, the Anhui Securities Regulatory Bureau issued an official administrative penalty decision on February 14, 2026. The unlawful facts have already been determined, and investors can therefore claim their losses in accordance with the law, including investment difference losses, commission and stamp duty losses, and so on.

Tian Lihui said that the claim conditions in this case have been clarified by professional lawyers: investors who bought Cubic Retiree shares between April 25, 2022 and April 28, 2025, and then sold them after April 29, 2025 or are still holding them and thus incur losses, may apply to make claims.

Regarding claim channels, Wang Huaitao said that investors typically resolve disputes through mediation, litigation, and other routes. Mediation, based on mutual voluntary agreement, is a relatively cost-effective solution. Investors can apply to mediation organizations such as the China Securities Capital Market Legal Service Center.

Wan Li told reporters that investor claims for compensation mainly fall into three categories. First, filing individual civil compensation lawsuits, in which investors that meet the conditions sue on their own or by appointing lawyers to the competent courts. Second, ordinary representative lawsuits or special representative lawsuits. Third, reducing the cost of rights protection through mechanisms that support litigation, mediation, or connect litigation and mediation via investor protection agencies. The supporting notices of the Supreme People’s Court and the CSRC have also clarified the coordination mechanism after courts accept cases involving securities false statements.

Tian Lihui added that the main claim channels include: first, online registration through internet platforms such as Sina’s investor rights protection platform, with professional lawyers connecting and coordinating; second, directly contacting law firms with experience in claims involving listed companies and submitting materials; third, paying attention to collective claim activities initiated by media. “Note that delisting does not affect investors’ right to claim compensation, but limitation periods for lawsuits and evidence preservation need to be arranged as early as possible,” Tian Lihui said.

（Editor: Wu Qing; Review: Li Zhenghao; Proofreading: Liu Jun）

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