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UPDATE 1-Second HK-listed Chinese firm rejects book-doctoring claims
September 4, 2014 / 12:36 AM / 3 years ago

UPDATE 1-Second HK-listed Chinese firm rejects book-doctoring claims

(Adds details on shares, background)

SHANGHAI, Sept 4 (Reuters) - China’s Shenguan Holdings Group Ltd on Thursday rejected a report by an equities research firm accusing it of doctoring its books, the second Hong Kong-listed Chinese firm targeted by such allegations this week.

Trading in the sausage-casing maker’s shares was halted on Wednesday after the publication of a report by Emerson Analytics accusing the company of understating costs and overstating revenues triggered a sharp fall in the share price.

Shenguan issued a statement on Thursday saying the report contained errors and misleading statements. It said it was aware that Shenguan had been the target of significant short-selling interest.

The company’s shares have been sliding steadily since mid-July despite a wider market rally, and lost more than 3 percent on Wednesday in heavy volume before trading was halted.

It said trading in its shares would resume after the directors posted a fuller report.

The text of the Shenguan statement is nearly identical to a similar statement posted by Tianhe Chemicals Group Ltd on Tuesday, rejecting allegations in a report published by Anonymous Analytics.

Based in the Guangxi Zhuang Autonomous Region, Shenguan has a market capitalisation of slightly over $1 billion, compared with Tianhe Chemicals’ $8 billion market cap.

Reporting by Pete Sweeney; Editing by Stephen Coates

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