Nanjing Tanker Corp. will become the first entity to be delisted from the Shanghai Stock Exchange in seven years, the Wall Street Journal reported Sunday, citing a statement from the bourse.
The delisting comes after the state-run shipping company posted a loss for the fourth straight year, it said. The stock had already been suspended from trading since April 2013, after the company’s third straight year of losses, as exchange rules require, the report noted.
The bourse will now allow the stock to resume trading after five trading days, and the shares will trade for 30 sessions before being removed from the bourse, it said.
“It could be a good example for China’s market-oriented reforms as it shows Beijing’s determination to strictly enforce the delisting mechanism to take off poor performers from the market,” Huang Cendong, an analyst with Sinolink Securities, was quoted as saying.
China’s securities regulator issued delisting rules in 2001, but the process has been ambiguous and underdeveloped, the report noted. The last delisting in Shanghai for poor financial performance was of petrochemical company Daqing Lianyi Petrochemical Co. in 2007. In Shenzhen, two small companies were delisted in 2012 after years of losses.
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