Shanghai-listed Narcissus Electric Appliances Co., Ltd, based in Shanghai, was the company to be delisted. It had both A and B shares.

The China Securities Regulatory Commission (CSRC) announced yesterday that Narcissus, which recorded net losses for a fourth year, was delisted yesterday after its application for a period of grace was rejected by the Shanghai Stock Exchange on Friday.

The company had already been put under particular transfer (PT) for one year due to three years of consecutive losses. This means its stocks could only be traded one day a week.

It was the first PT company to be denied time to turn itself around. This is the last chance for the loss-making firms to remain listed.

The CSRC had issued rules that allowed delisting in February, a new penalty for debt-ridden listed companies.

It reiterated a month ago that it was willing and able to delist any domestic firm that posted losses for three consecutive years.

It also warned investors that PT firms and those entering the category were high-risk.

"We have asked PT companies and stock exchanges to post risk warnings so investors are aware of the risks involved in PT stocks,'' a CSRC spokesman said yesterday.

Delisting Narcissus means that a new exit mechanism has been established to get rid of poor-performing stock companies.

While pushing listed companies to perform better, it will also help improve the overall quality of the stock market and bolster its healthy development, the spokesman said.

But he also noted that delisting is not equal to bankruptcy.

(China Daily 04/24/2001)