*ST Xing Nong Administrative Penalty Notice: The annual report contains false records; the company and four current senior executives are proposed to be fined a total of 6.9 million yuan

On March 17, Starlight Agricultural Machinery Co., Ltd. (*ST Xingnong, 603789.SH) announced that it received a “Preliminary Administrative Penalty Notice” (Zhejiang Penalty [2026] No. 3) from the Zhejiang Regulatory Bureau of the China Securities Regulatory Commission. Due to false statements in the 2023 annual report and suspected violations of information disclosure laws, the company and four current senior executives are proposed to be fined a total of 6.9 million yuan; at the same time, the company’s stock will be subject to additional risk warnings starting March 18 and will continue trading on the risk warning board.

The “Preliminary Administrative Penalty Notice” states that, according to the Zhejiang Securities Regulatory Bureau’s investigation, in 2023, its wholly owned subsidiary, Bazhou Xingguang Zhiyuan Smart Agriculture Technology Co., Ltd. (Xingguang Zhiyuan), engaged in false cotton harvesting, consulting, and promotional services. The company falsely increased its operating income by 60.7274 million yuan, accounting for 19.69% of the disclosed revenue for that period; it also inflated total profits by 5.2895 million yuan, representing 9.77% of the disclosed profit for that period, leading to false statements in the 2023 annual report. On September 27, 2025, *ST Xingnong issued an announcement on the correction and retrospective adjustment of previous accounting errors, which addressed these issues.

The Zhejiang Securities Regulatory Bureau believes that the above actions by *ST Xingnong violate relevant provisions of Article 78, Paragraph 2 of the Securities Law of the People’s Republic of China, constituting an illegal act as described in Article 197, Paragraph 2 of the Securities Law. The then Chairman He Dejun, the then Directors and General Manager Zheng Bin, Xingguang Zhiyuan’s then General Manager Liu Tao, and the then Financial Officer Wu Haijuan failed to perform their duties diligently and are directly responsible for the company’s overall management, operational management, false subsidiary business activities, and financial information disclosure, and are deemed to be directly responsible for the company’s illegal conduct.

The announcement states that, based on the facts, nature, circumstances, and social harm of the illegal acts, and in accordance with Article 197, Paragraph 2 of the Securities Law, the Zhejiang Securities Regulatory Bureau intends to decide: to issue a warning to Xingguang Agricultural Machinery Co., Ltd. and impose a fine of 2.5 million yuan; to issue warnings to He Dejun, Zheng Bin, and Liu Tao, and fine each 1.2 million yuan; to warn Wu Haijuan and fine 800,000 yuan.

*ST Xingnong stated in the announcement that as of the disclosure date, the company’s various operations and businesses are proceeding normally. The above issues will not have a significant impact on the company’s production and operations.

On the same day, *ST Xingnong also disclosed that due to receiving the “Preliminary Administrative Penalty Notice” (Zhejiang Penalty [2026] No. 3) on March 17, the company’s stock will be subject to additional risk warnings starting March 18, 2026, according to Article 9.8.1 of the Shanghai Stock Exchange Listing Rules. After the additional risk warning is implemented, the company’s stock abbreviation remains “*ST Xingnong,” the stock code remains “603789,” the daily price fluctuation limit remains at 5%, the stock will not be suspended, and trading will continue on the risk warning board.

According to the official website, Xingguang Agricultural Machinery Co., Ltd. was established in 2004. It is a listed enterprise integrating research and development, manufacturing, sales, and service, specializing in creating high-performance, efficient agricultural machinery and providing technical support.