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Financial

25/02/2013

A leading Chinese motorcycle manufacturer, Jinan-based Qingqi, now has the dubious distinction of becoming the first-ever public company to be compulsorily delisted by the Shanghai bourse (China’s biggest stock exchange), following introduction of revised regulatory sanctions.

Trading in Qingqi shares was suspended by the bourse last April, following announcement of a third consecutive annual loss — the equivalent of £10.6m in the red for its 2011 financial year. The company then languished under the threat of delisting should it fail to achieve a return to profit in 2012, which it evidently hasn’t. The axe finally fell upon the resumption of share-dealing after the Chinese lunar new year celebrations on 18 February and Qingqi disappeared from international stock charts.

Qingqi is controlled by China South Industries Group (CSIG) a Chinese Government holding entity with majority stakes in a large number of similar public companies. At the time of this stock trading suspension, regulators were reportedly investigating the role of a number of senior regional Chinese Communist Party officials involved in management oversight of both CSIG and Qingqi, in relation to substantial non-performing loans which had been extracted from the business for unspecified purposes. No details of any conclusion to that probe are available. The fate of independent investors, the value of whose Qingqi shares was suffering a 25 per cent year-on-year decline when trading halted, is also unknown.  

Founded in 1956, Qingqi has been a Suzuki joint-venture bike manufacturing partner since 1985 and a Peugeot scooter production contractor since 2006. It also exports own-brand products widely, including to the UK. In 2012, Qingqi had a British market share of one per cent, thanks to 939 units registered, falling by 11.4 per cent from 1060 units in the previous year. Qingqi was also the source of Chinese-made 125cc Suzuki grey imports entering the UK in the middle of the past decade.