Former Party Secretary and Chairman of Zhejiang Construction Investment Group Co., Ltd., Shen Defa, is currently undergoing disciplinary review and supervisory investigation by the Zhejiang Provincial Commission for Discipline Inspection and Supervision. This comes after Shen Defa voluntarily surrendered and was suspected of serious violations of discipline and law, as announced by the Zhejiang Provincial Commission for Discipline Inspection and Supervision on November 5.
Shen Defa had recently resigned as A-share chairman less than a month before the investigation. On October 18, Zhejiang Construction Investment (002761) received the resignation report of Chairman Shen Defa, who cited personal reasons for his decision to resign as director and chairman of the company.
The announcement of Shen Defa’s resignation caught attention due to its deviation from the norm. Unlike many A-share companies, Zhejiang Construction Investment did not address Shen Defa as “Mr.” nor express gratitude for his past performance experience.
Shen Defa, a highly educated individual with a master’s degree in business administration, had served in various positions within Zhejiang Construction Investment Group. He held roles such as deputy general manager, general manager, Chairman, and Party Secretary. Additionally, he was involved in professional associations and held representative positions in the National People’s Congress and the Chinese People’s Political Consultative Conference.
Zhejiang Construction Investment is a prominent state-owned construction enterprise in Zhejiang Province, engaged in construction business and related industries. It has consistently ranked among the top contractors and enterprises in China and Zhejiang Province in various prestigious lists.
The company went public through a backdoor transaction, merging with Duo Fai, a listed company in Hunan. After gaining approval for the restructuring plan on the second attempt, the merged entity renamed itself Zhejiang Construction Investment.
Following its listing, Zhejiang Construction Investment experienced monumental growth in its stock price. Within three years, its stock price surged from 7.52 yuan per share to a peak of 47.09 yuan per share, an increase of over six times. This remarkable rise made it the standout stock of the year and earned it the nickname of a “6-fold bull stock.” However, since May 2022, the company’s stock price had been steadily declining.
In the third quarter of 2023, the company reported a year-on-year increase of 3.33% in operating income, reaching 71.763 billion yuan. However, its net profit attributable to the parent company decreased significantly by 48.35% to 534 million yuan.
Despite the investigation into Shen Defa and the challenges faced by the company, the article warns readers that the publication of this content by the Oriental Fortune does not constitute investment advice and advises readers to operate accordingly at their own risk.