Shanghai Stock Exchange's first delisting of the year is implemented, *ST Jinglun reaches the trading delisting red line

Ask AI · *ST Jinglun: Why did it go from a star enterprise in Optics Valley to delisting?

On the evening of April 3, *ST Jinglun (600355) announced that, due to its total market value closing every day for 20 consecutive trading days being below 500 million yuan, it had officially met the forced delisting threshold for trading-related delisting. The Shanghai Stock Exchange has issued a “Pre-Delisting Notice for Termination of Listing,” and the company’s stock has been suspended from trading starting April 7, making it the first listed company in Shanghai to be forcibly delisted in 2026.

From a former star enterprise in Optics Valley to a quiet farewell to A-shares, the end of *ST Jinglun is the result of multiple overlapping factors: seven years of massive performance losses, failure of internal controls, and repeated regulatory warnings.

According to public information, the predecessor of *ST Jinglun—Jinglun Electronics Co., Ltd.—was established in December 1994, founded under the leadership of Zhang Xueyang. In June 2002, it was listed on the Shanghai Stock Exchange, becoming the first nationwide listed company initiated by natural persons only. At its peak, it held a place in niche markets such as public communication terminals and identity recognition, and was one of the representatives of private technology enterprises in Hubei’s Optics Valley. Its principal business covers three major segments: intelligent manufacturing, commercial smart terminals, and software information services. Its core products include industrial sewing machine servo systems, ID card reading and verification devices, IoT charging equipment, and smart IoT solutions, among others.

However, with accelerated iteration of communication technology and intensifying industry competition, the company failed to keep up with the pace of industrial upgrading in time. Its core business continued to shrink, its market competitiveness declined year by year, and it gradually fell into operating difficulties. The continuous deterioration of financial data is the key root cause of *ST Jinglun’s path toward delisting.

A reporter’s review of the company’s recent financial reports shows that the company has been mired in a state of continuous losses since 2019. It has now recorded negative net profit for 7 consecutive years, forming a vicious cycle of “sluggish revenue, expanding losses, and exhausted cash flow.” In 2023, the company recorded a loss of 43.36 million yuan. In 2024, the loss narrowed slightly but still reached 42.06 million yuan. The 2025 annual performance forecast released in January 2026 indicates that the company expects a full-year net loss of 39.50 million to 45.50 million yuan. In addition, after excluding, operating revenue is only about 86.22 million yuan, far below the 300 million yuan financial delisting red line.

As of the end of the third quarter of 2025, *ST Jinglun’s total assets were only 252 million yuan, while total liabilities reached 148 million yuan. Its asset-liability ratio was approaching 60%, and its net assets were less than 104 million yuan, with the capital chain already on the brink of breaking. Operating cash flow has been net outflow for multiple years in a row. In the first three quarters of 2025, the net outflow amount was 8.8598 million yuan, and daily operations became difficult to sustain. Continuous performance losses have thoroughly undermined market confidence. Since the beginning of 2026, the company’s stock price has entered a “cliff-like” decline, with a cumulative drop of 74.11% for the year, laying the groundwork for delisting.

It is also worth noting that the failure of internal controls, along with multiple regulatory-violation incidents that led to regulatory penalties, further accelerated *ST Jinglun’s delisting process. In December 2020, the Hubei Securities Regulatory Bureau found that the company had multiple violations, including in 2018: booking expense accruals across accounting periods, understating expenses by 3.6699 million yuan, and artificially inflating profit for the year by 33.32% of that year’s net profit. It also found that different impairment methods were used for inventories by different entities, yet the company did not disclose this as required; additionally, internal control self-assessment reports for 2018 to 2019 claimed there were “no major defects,” while in reality there were internal control loopholes such as chaotic seal management and nonstandard meeting records.

In response, the Hubei Securities Regulatory Bureau issued warning letters to the company and relevant responsible parties, including Chairman Zhang Xueyang and the person in charge of finance. In 2021, the Shanghai Stock Exchange also placed the company and related responsible persons under regulatory attention.

Since the beginning of 2026, *ST Jinglun has been surrounded by three categories of delisting risks: trading-related, financial-related, and face value-related. Among them, the trading-related delisting indicator was triggered first, becoming the final straw that pushed the company over the edge.

From March 9 to April 3, the company’s stock price hit the daily trading limit down repeatedly. Its market value shrank rapidly from above 400 million yuan. By the close on April 3, the stock price was 0.58 yuan and the total market value was only 285 million yuan. Having remained below 500 million yuan for 20 consecutive trading days, it precisely hit the trading-related forced delisting red line specified in the first paragraph, item 5 of Article 9.2.1 of the “Shanghai Stock Exchange Stock Listing Rules.”

At the same time, the stock price had been below 1 yuan for 16 consecutive trading days, also moving toward the face value delisting indicator. Furthermore, the 2025 performance forecast shows “net profit is negative and revenue after deductions is below 300 million yuan,” which also means that even if the trading-related delisting threshold had not been triggered, after the annual report is disclosed, the company would still meet the financial-related delisting threshold.

Pursuant to relevant exchange rules, trading-related forced delisting has no delisting preparation period. After the stock is suspended starting April 7, the Shanghai Stock Exchange will review the termination of listing matter within 15 trading days after the deadline or the conclusion of the hearing. Then, within the subsequent 5 trading days, the stock will be directly removed from the exchange. The delisting process is irreversible. As of the time of this report, *ST Jinglun has not yet announced whether it will apply for a hearing. However, regardless of the subsequent procedures, a company with 24 years of listing history has essentially been confirmed to say goodbye to the A-share market.