Keda Industrial Group Co.,Ltd. and 10 Executives Receive Regulatory Warnings for Violations Including Improper Loans to Chairman

Deep News2025-11-01

On the evening of October 31, Keda Industrial Group Co.,Ltd. (600499.SH, share price: ¥13.11, market cap: ¥25.14 billion) announced that it received a regulatory decision from the Guangdong branch of the China Securities Regulatory Commission (CSRC). The company was found to have committed multiple violations, including inaccurate periodic financial disclosures, failure to properly review and disclose executive compensation, undisclosed related-party fund usage, and unauthorized financial assistance to related parties without disclosure.

The Guangdong regulator issued warnings to 10 responsible individuals, including former Chairman Bian Cheng, former Director and General Manager Yang Xuexian, former Deputy General Manager and CFO Zeng Fei, and other executives. Separately, the Shanghai Stock Exchange (SSE) issued regulatory warnings to four individuals—Peng Qi, Zhang Zhonghua, Zhou Peng, and Peng Hengxiang—while publicly reprimanding Keda Industrial Group Co.,Ltd. and six others, including Bian Cheng and Yang Xuexian.

Investigations revealed that Keda Industrial Group Co.,Ltd. had used employee and family member bank accounts for off-book transactions, leading to misreported profits from 2022 to the first half of 2025. Additionally, between 2017 and 2018, Bian Cheng improperly used company funds through supplier prepayments, while from 2021 to 2024, Bian Cheng and Zhang Zhonghua borrowed ¥8.355 million and ¥7.2 million, respectively, from off-book accounts.

The company has taken corrective actions, including closing off-book accounts, recovering misallocated executive compensation, and repaying unauthorized loans. Bian Cheng has personally reimbursed the company for outstanding funds tied to frozen investments.

Despite the regulatory issues, Keda Industrial Group Co.,Ltd. reported strong revenue and net profit growth in its Q3 2025 earnings. The company, a leading Chinese ceramic machinery manufacturer listed on the SSE in 2002, stated that it has largely addressed the regulator’s concerns.

Among the 10 individuals penalized, Zhang Zhonghua, Wu Muhai, and Li Qing have since left their positions, while Li Yuejin remains with the company but no longer serves as board secretary.

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