Hangxiao Steel boss fined
(Bloomberg)Updated: 2007-05-15 09:44 Zhejiang Hangxiao Steel Structure Co was fined by China's securities regulator for failing to disclose contracts worth more than 10 times the company's market value that sent the stock price soaring to a record.
 Zhejiang Hangxiao Steel Structure Co. was fined by China's securities regulator for failing to disclose contracts worth more than 10 times the company's market value that sent the stock price soaring to a record. [newsphoto] |
The China Securities Regulatory Commission fined Hangxiao 400,000 yuan ($52,000), Chairman Shan Yinmu and President Zhou Jinfa 200,000 yuan each, and three further officials 100,000 each, the company said in a Shanghai Stock Exchange statement.
The penalties underscore the government's attempts to crack down on abuses in a stock market that almost tripled in value in the past year, prompting warnings of a possible bubble by officials including central bank head Zhou Xiaochuan. Small and even money-losing companies have outperformed the benchmark index this year on speculative buying.
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The statement "spurred speculation on the stock again," said Zhang Qi, an analyst at Haitong Securities Co. in Shanghai.
Shares of the building materials maker, based in the eastern city of Hangzhou, rose 1.35 yuan to 14.88 yuan at the 11:30 a.m. trading break. The stock has risen more than fourfold this year, giving the company a market capitalization of 3.7 billion yuan.
Misleading Comments
Hangxiao Steel failed to disclose the orders from Angola in newspapers or tell investors about the transaction in due time, the statement said, citing the regulator. Comments by company officials relating to the probe were misleading, it said.
Company director Pan Jinshui told media on April 5 that the regulator's
investigation was "basically over" and the company didn't violate disclosure
rules, the statement said.
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