Research On The Compulsory Delisting Of ST Xindu

In April 1998,the Shanghai and Shenzhen Stock Exchanges imposed regulations on the mandatory delisting of listed companies for the first time.The issue of mandatory delisting of listed companies was concerned by the public for the first time.On November 16,2014,with the stricter new delisting rules,The issue of mandatory delisting of listed companies has attracted public attention,and the problem of forced delisting has gone through the process of being nothing and getting more and more attention.In a healthy securities market,the delisting of listed companies should be as important as the IPO.Because only inferior companies can continually withdraw from the securities market,the proportion of high-quality companies in the securities market will become higher,thereby improving the overall quality of listed companies and more effectively exerting the role of optimizing the allocation of resources in the securities market.Delisting can be divided into two types: forced delisting and voluntary delisting.Compared with voluntary delisting,there are more problems in forced delisting,and the interests involved are more complicated.The number of companies that are forced to withdraw from the market every year in China's securities market is so small.What is the reason that the listed companies are forced to withdraw from the market.How can the delisting system be further improved.These are worthy of our consideration.This paper intends to use the case analysis method and select the first stock delisting in 2017,ST Xindu for analysis.The reason why ST Xindu is delisted is that the audit report for two consecutive years has been issued with “unable to express opinions” and has been suspended from listing.It was also forced to withdraw from the market because the profit indicator did not meet the conditions for resuming listing.Based on the research of related literatures,this paper first introduces the whole delisting process of ST Xindu and analyzes the financial situation of ST Xindu a few years before delisting;secondly,the main reasons for the mandatory delisting of ST Xindu are given in two aspects which is outside reason and inside reason.Finally,the enlightenment and suggestions are given from the perspectives of listed companies,government regulators and small investors.Although in the short term,a large number of listed companies are forced to withdraw from the market may have a certain impact on the stability of China's capital market.At the same time,it may bring certain losses to some investors in the securities market.However,from a long-term perspective,the establishment and improvement of the delisting system will improve the overall quality of listed companies in the A-share market and optimize the resource allocation in the capital market.It will also have great significance in achieving the function of the survival of the fittest in the securities market.