Chairman arrested, LDG shares fall to the floor

With Mr. Nguyen Khanh Hung - Chairman of the Board of Directors of LDG Investment JSC (code LDG) - having just been prosecuted and temporarily detained, the company's shares immediately reacted negatively. As soon as the trading session on December 1 began, LDG shares plummeted to the floor price of VND3,450/unit. The floor sell orders increased while the stock had no buyers, and the matching orders were small.

Before Mr. Hung was arrested, LDG shares were also not trading very positively. In just 1 week, this stock decreased by 11%. After 1 year, LDG decreased by more than 33% of its market value.

LDG stock performance over the past year.

Also right before the chairman was arrested, LDG was fined VND170 million by the State Securities Commission for violating information disclosure. The company failed to disclose on time and incorrectly disclosed the content of its financial statements, profit explanations, and bond disclosure information.

Last year, LDG Company attracted attention in the market when on August 25, Mr. Nguyen Khanh Hung was fined more than VND520 million by the State Securities Commission and suspended from trading for 4 months for "secretly selling" more than 2.6 million LDG shares on August 15.

The Chairman of LDG has made a transaction to sell more than 2.6 million LDG shares through an account opened at Dragon Viet Securities Joint Stock Company (VDSC). According to VDSC, when customers placed a securities transaction order, the system clearly warned (the customer is an insider, a related person who is subject to information disclosure before the transaction).

In his explanation to the Ho Chi Minh City Stock Exchange (HoSE), Mr. Hung said that from August 8 to 15, he had a business trip away, so he assigned his secretary to make the information disclosure according to regulations. “However, because the new staff did not understand the regulations, it led to errors and delays in the information disclosure process. On August 15, when I returned from the business trip, I discovered the error, so I requested additional handling to ensure compliance with regulations, and stopped all subsequent transactions,” Mr. Hung explained.

Regarding business performance, in the first 9 months of this year, LDG recorded a revenue of VND 2 billion, down 99.1% year-on-year. The company lost more than VND 209 billion after tax while in the same period it made a profit of VND 8.3 billion. As of September 30, 2023, LDG's total assets were VND 2,094 billion, down 14% compared to the beginning of the year. Total liabilities amounted to VND 4,558 billion. Of which, short-term debt was VND 3,317 billion and long-term debt was more than VND 1,240 billion.

In the market, LDG shares are under control since the company's late submission of audited financial statements for 2022, 30 days later than the prescribed deadline.

(Source: Tien Phong)

Source