On October 13th, the Hong Kong Securities and Futures Commission announced that, in accordance with Rule 8 (1) of the Securities and Futures (Listing on the Securities Market) Rules, it has instructed the Stock Exchange of Hong Kong Limited (HKEX) to suspend trading of shares of Sichuan Baicha Baidao Industrial Co., Ltd. (02555. HK, hereinafter referred to as "Tea Baidao") from 9:00 am today.

The announcement stated that the China Securities Regulatory Commission is highly concerned that the initial public offering of Chabaidao may have been artificially manipulated, with the intention of creating a false impression of Chabaidao's stock demand. During the ongoing investigation by the China Securities Regulatory Commission, it is necessary or appropriate to suspend the trading of shares in Chabaidao in order to maintain an orderly and fair market for the stock and safeguard the interests of the investing public.

The Hong Kong Securities and Futures Commission stated that it has taken action against two groups on suspicion of participating in fraudulent schemes with the intention of creating false or untrue representations regarding the demand for shares in their initial public offerings.

The Hong Kong Securities and Futures Commission has disclosed that for the first suspicious group, the commission has issued restriction notices to six brokerage firms, prohibiting them from disposing or dealing with assets in the accounts of Sun Ran (female) and eight related companies' clients, up to a limit of approximately 4.379 billion yuan (the highest limit amount in the commission's history of similar cases). The first suspicious group is suspected of participating in a fraudulent scheme related to the initial public offering of Pan Kang Shi Yun Pharmaceutical Co., Ltd. (Pan Kang Shi Yun) and Cha Bai Dao.

In addition, the Hong Kong Securities and Futures Commission disclosed that for the second suspicious group, the Commission has issued restriction notices to 29 brokerage firms, prohibiting them from handling or disposing of assets in client accounts under the names of Liu Haoran (male), The Reynolds Lemkins Group (Asia) Limited, and Kaufmann&Company Pan Asia Limited (these three entities), up to a limit of approximately HKD 28.503 million. This suspicious group is suspected of participating in a fraudulent scheme related to the initial public offering of Tianjiu Dihe (Suzhou) Technology Co., Ltd. (Tianjiu Dihe).

Mr. Michael Duignan, Executive Director of the Regulatory Enforcement Department of the China Securities Regulatory Commission, said, "We believe that the actions taken so far have dealt a significant blow to two suspicious groups suspected of participating in the manipulation of initial public offerings. We have taken decisive action to suspend trading of shares in Tea Path and preserve assets related to the suspected plan to protect investors and maintain the integrity and stability of the Hong Kong market. These actions also aim to help strengthen investors' confidence in the fairness and integrity of the Hong Kong initial public offering market

The Hong Kong Securities and Futures Commission further disclosed that Sun Ran is a licensed representative of Jardine Matheson International Investment Limited. The six brokerage firms are China International Capital Hong Kong Securities Limited, CMB International Securities Limited, Futu Securities International (Hong Kong) Limited, Haitong International Securities Limited, Jiashi International Investment Limited, and Huasheng Capital Securities Limited.

It is reported that Jiashi International Investment Co., Ltd. is a wholly-owned subsidiary of Jiashi Fund Management Co., Ltd.

Bokang Vision Cloud Pharmaceutical Co., Ltd. will be listed on the main board of the Stock Exchange from July 3, 2025. The China Securities Regulatory Commission instructed the Stock Exchange of Hong Kong to suspend trading of the company's shares on September 10, 2026. Tianjiu Dihe (Suzhou) Technology Co., Ltd. will be listed on the main board of the Stock Exchange from June 28, 2024. The trading of the company's shares will be suspended from April 1, 2025.

In April 2024, Chabaidao was listed on the Hong Kong Stock Exchange, becoming the second new tea beverage brand in China to go public after Nayuki Tea (02150. HK). At the same time, the company is also the first franchised new tea beverage company to go public. As of press time, the total market value of Chabaidao is HKD 6 billion.

The Hong Kong Securities and Futures Commission stated that it will not make further comments as the investigation is still ongoing. As of press time, Chabaidao has not yet publicly responded to this matter.

(Author Cai Yuekun)