Exchanges crack down on non-compliant listed firms

May 24, 2024 - 07:24
The main reason was that the listed companies were failing to submit audited financial statements for 2023 ahead of the deadline.
Traders work on a trading floor of a securities company. — Photo

HÀ NỘI — The two main stock exchanges, the Hồ Chí Minh Stock Exchange (HoSE) and the Hà Nội Stock Exchange (HNX), have taken regulatory action against several listed companies due to their failure to submit financial reports on time.

HoSE said that status of certain stocks have been transferred from controlled to restricted trading. They are shares of DRH Holdings JSC, Central Power Real Estate, VAI Cat Tuong Auditing Co., Ltd and Searefico Corporation.

The decision is typically due to the listed companies failing to submit their audited financial statements for 2023 within the required 45-day deadline.

As a consequence, starting May 27, these shares will only be allowed to trade in the afternoon trading session, using the centralised order matching and negotiated trading methods, which will limit trading activity and any volatility.

The companies have acknowledged that they did not file on time but as of now, they have still not yet published the overdue audited financial reports.

The situation is not unheard of, as the HoSE has previously taken similar action, transferring over 60 million shares of Đông Á Plastic JSC into restricted trading from May 24 due to disclosure lapses.

The southern exchange also decided to move over 49.2 million shares of Thiên Nam Trading Import Export JSC to limited trading from controlled status due to the same reason. As a result, trading in Thiên Nam shares can now only happen in the afternoon sessions from May 24.

Meanwhile, HNX has restricted the trading of select stocks to Friday sessions from May 22. The companies are KTT Group, HTINVEST JSC, Đại Việt Group, VNDIVNEST JSC, Vinam JSC, Tùng Khánh Tramaco and Sông Đà JSC.

Within 15 days of the decision, companies are obliged to submit their remedial plans to the exchanges and make public disclosures about which specific measures they will take to address the issues that led to the trading restrictions, as well as provide a clear timeline for resolving the non-compliance.

Beyond the trading limitations, some of the above stocks, including KTT Group, HTINVEST, Vinam and Sông Đà 6, have also been placed under warning status by the exchanges.

This typically occurs when companies exhibit financial distress or persistent delays in meeting reporting obligations. — VNS