Xinya Zhijie, whose shares doubled in two months, receives warning letter from Zhejiang regulator over delayed disclosure of subsidiary debt and litigation

September 23, 2024 — New Asia Process (002388) announced on Monday evening that it has received a warning letter from the Zhejiang Securities Regulatory Bureau (Zhejiang SRC).

Violations Identified

According to the warning letter, during on-site inspections and routine supervision, Zhejiang SRC found that New Asia Process had failed to:

• Timely disclose material debts of its subsidiaries
• Timely disclose the company's guarantees provided for those subsidiary debts
• Timely disclose major litigation disputes related to those debts

Responsible Parties and Penalties

Wang Weihua, the company's then-chairman, general manager, and acting board secretary, was held primarily responsible for the violations.

Zhejiang SRC decided to issue warning letters to both the company and Wang Weihua, and record the matter in the securities and futures market integrity archive.

Regulatory Requirements

Zhejiang SRC has ordered New Asia Process and relevant personnel to:

• Fully learn from the incident
• Strengthen their understanding of relevant laws and regulations
• Fulfill their duties of diligence and care
• Ensure truthful, accurate, complete, timely, and fair information disclosure
• Submit a written report to Zhejiang SRC within 10 working days of receiving the decision

Company Response

New Asia Process stated that it takes the warning letter seriously and will strictly follow Zhejiang SRC's requirements. The company said it will learn from the incident, enhance its understanding of relevant laws and regulatory documents, improve operational standards and information disclosure quality, and prevent similar incidents from recurring. It also confirmed it will submit a written report within the required timeframe.

The company emphasized that this administrative supervisory measure will not have a material impact on its normal production and management activities.

Company Background

According to public information, New Asia Process's main businesses include:

• Electronic process solution services
• Electronic process product services
• Industrial supporting services

Its primary products include electrolytes and lithium hexafluorophosphate, electronic equipment, instruments and meters, chemical materials (adhesives), and electronic components.

Stock Performance and Financial Data

Since late July, the company's stock price has more than doubled over a two-month period.

Financial data shows:

• 2024 net profit attributable to shareholders: -236 million yuan
• 2025 net profit attributable to shareholders: -22.2772 million yuan
• First half of 2026 net profit attributable to shareholders: -11.7108 million yuan