China’s Leading Auto Dealer Faces Delisting as Stock Sinks

By Wang Juanjuan and Han Wei

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A brutal price war has continued since early 2023, squeezing industry players already struggling with slowing sales

China Grand Automotive Services Group Co. Ltd., one of the country’s largest auto dealers, is set to be removed from the Shanghai Stock Exchange after its stock consistently traded below par value, as a cut-throat price war rattles the world’s largest car market.

Grand Automotive (600297.SH) closed down 10.34% at 0.78 yuan per share on Wednesday, the 20th trading session in a row the stock traded below 1 yuan, triggering a delisting according to market rules. The delisting will affect nearly 100,000 investors.

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China Grand Automotive Services Group Co. Ltd. will be delisted from the Shanghai Stock Exchange after its stock traded below 1 yuan for 20 consecutive sessions.
The company's 2023 revenue was 138 billion yuan, with a net profit of 392 million yuan after recovering from a loss in 2022.
The ongoing price war and aggressive equity expansion impacted the stock, leading to significant operational pressures and negative market sentiment.

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Who’s Who

China Grand Automotive Services Group Co. Ltd.: China Grand Automotive Services Group Co. Ltd., established in 1999, is China's top auto dealer, selling 713,000 passenger vehicles in 2023 with revenue of 138 billion yuan. Despite a 2023 net profit of 392 million yuan, it faces delisting from the Shanghai Stock Exchange due to its stock trading below 1 yuan. The company's stock decline is attributed to a severe price war and aggressive equity expansion.

Xinjiang Guanghui Industry Investment Group Co. Ltd.: Xinjiang Guanghui Industry Investment Group Co. Ltd., established by Sun Guangxin, owns 32.68% of China Grand Automotive Services Group Co. Ltd. and controls four other listed firms. Founded by Sun, this group is a significant shareholder in what was China’s top auto dealer before its delisting due to a prolonged drop in stock value amid a price war in the automotive market.

Zhongsheng Group Holdings Ltd.: Zhongsheng Group Holdings Ltd. is mentioned as the industry leader in revenue among China's auto dealers, surpassing Grand Automotive's 138 billion yuan in 2023. Grand Automotive ranks second in the industry in terms of revenue. No further specific details about Zhongsheng Group Holdings Ltd. are provided in the article.

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What Happened When

1999：: China Grand Automotive Services Group Co. Ltd. was established by businessman Sun Guangxin.

2015：: Grand Automotive debuted through a backdoor listing.

Late 2017：: Grand Automotive's market value started to decline from its peak of more than 100 billion yuan.

Early 2023：: A brutal price war began in the automotive industry.

2023：: Grand Automotive sold 713,000 passenger vehicles, achieving revenue of 138 billion yuan and reporting a net profit of 392 million yuan.

End of 2023：: Grand Automotive's debt-to-asset ratio stood at 64%, with net assets totaling 38.97 billion yuan.

First quarter of 2024：: Grand Automotive’s sales fell 11.5%, and its net profit plunged 86.6%.

Late May 2024：: Grand Automotive’s stock price fell into a critical zone for delisting, dropping below 1.5 yuan.

June 3, 2024：: Grand Automotive announced a purchase plan by senior executives and the parent company to revive its stock.

By June 19, 2024：: Sun Guangxin's Xinjiang Guanghui Industry Investment Group Co. Ltd. owned 32.68% of Grand Automotive.

By June 20, 2024：: Grand Automotive’s stock fell below the 1-yuan threshold.

Wednesday, July 17, 2024：: Grand Automotive closed down 10.34% at 0.78 yuan per share, marking the 20th consecutive trading session the stock traded below 1 yuan, triggering its delisting.

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