On October 30, 2025, Zhejiang Tony Electronic Co., Ltd. (abbreviated as Tony Electronic, stock code: 603595) announced that it had received a "Prior Notice of Administrative Penalty" from the Zhejiang Regulatory Bureau of the China Securities Regulatory Commission (CSRC).
The Zhejiang Regulatory Bureau found that Tony Electronic was involved in the following violations: 1. **Delayed Disclosure of Major Contract Progress**: On January 9, 2023, Tony Electronic’s subsidiary, Huzhou Tony Semiconductor Technology Co., Ltd. (Tony Semiconductor), signed a procurement contract with Guangdong Tianyu Semiconductor Co., Ltd. (Guangdong Tianyu). The contract stipulated that Tony Semiconductor would deliver 135,000 pieces of 6-inch silicon carbide substrates monthly from May to December 2023, with a total contract value of 675 million yuan, accounting for 51.84% of the company’s latest audited main business revenue. The company disclosed this in an announcement on January 10, 2023. However, during the contract period, Tony Semiconductor failed to meet the monthly delivery targets. By October 2023, only 6.74% of the contract had been fulfilled, making it clear that the delivery schedule could not be completed as agreed. The company delayed disclosing this material information until January 6, 2024.
2. **False Records in 2022 Annual Report and 2023 Interim Report**: - Misclassifying defective crystals as inventory instead of R&D expenses, understating R&D costs and inflating total profits. - Failing to account for raw materials purchased with funds advanced by related parties, leading to underreported R&D expenses and operating costs, thereby overstating profits. - Inadequate provision for inventory impairment, resulting in understated asset impairment losses and inflated profits.
As a result, the company overstated total profits by 38.77 million yuan in its 2022 annual report and 72.28 million yuan in its 2023 interim report, accounting for 38.63% and 70.95% of the disclosed amounts, respectively. In April 2024, the company issued corrections for these accounting errors.
Consequently, the Zhejiang Regulatory Bureau proposed penalties, including warnings and fines for Tony Electronic and its responsible personnel.
Previously, on April 26, 2025, Tony Electronic disclosed that it had received a formal investigation notice from the CSRC.
Under China’s Civil Code, Securities Law, and judicial interpretations on false statement compensation, companies involved in securities fraud—including false disclosures—are liable for investor losses, covering investment gaps, commissions, stamp duties, and interest. Affected investors may file claims in court.
Due to Tony Electronic’s alleged violations, lawyer Song Yixin of Shanghai Hanlian Law Firm is gathering affected investors for potential compensation claims. Eligible claimants include those who purchased Tony Electronic securities between March 11, 2023, and January 5, 2024, and held or sold them after January 6, 2024.
**Key Notes for Investors**: 1. Claim eligibility may adjust based on final CSRC penalties and court rulings. 2. While direct lawsuits are possible without prior penalties, success is uncertain without regulatory conclusions. 3. Delisting or bankruptcy may affect litigation timelines but not eligibility. 4. Required documents for claims include ID copies, securities account statements, and transaction records.
(Note: This summary is based on legal analysis and does not constitute investment advice.)
