Grizzly Research, a U.S. short-selling agency that has repeatedly hit the stocks, accused the company of falsifying and inflating its earnings and deliberately cooperating with criminals. After the news was issued, SenseTime fell as low as 0020.1 yuan in the intraday, and SenseTime fell 3.5% to 6.1 yuan in the first half of the day, with a turnover of 36 million yuan.
In response to the inquiry of "Hong Kong 01" through public relations, SenseTime said that it is not convenient to respond to the accusations made by Grizzly Bear Research against the company at present, and the company may reply later, but it has no plans to clarify or respond to the public for the time being.
Subsequently, the Company issued an announcement in the after-afternoon market, pointing out that the report of Grizzly Bear Research was unfounded, and contained unfounded speculations and misleading conclusions and interpretations, lacking a basic understanding of the Company's business model and financial reporting structure, as well as a comprehensive interpretation of public information. At the same time, it was pointed out that the author of the report did not contact the company to confirm the authenticity of the relevant information or obtain any understanding of the financial report. The Board of Directors of the Company is reviewing the allegations and considering appropriate action to protect the interests of all shareholders, noting that it reserves all rights to take appropriate action to protect the Company and its shareholders.
Grizzly accused SenseTime of knowingly cooperating with the perpetrators
The agency report pointed out that SenseTime claims to be a leading AI company, but the agency believes that its so-called AI revenue is actually "artificial inflation". Two court cases describe SenseTime's revenue fabrication and round-trip schemes, alleging that SenseTime provides funds to customers, either directly or through intermediaries, and that funds are used to purchase goods from SenseTime that may never have been delivered.
The report goes on to say that the CEO of Capitla Watch, a mainland financial outlet, confirmed the claim, saying that SenseTime invested in a third-party company in exchange for an equal amount of revenue, but did not actually deliver the product. Grizzly also argued that SenseTime's alleged revenue method involved a counterparty who was detained by the police and never returned the money, meaning that SenseTime either deliberately cooperated with criminals or did not engage in risk management.
In addition, Grizzly also said that it was found that SenseTime's top management controlled a number of undisclosed related parties and had been deliberately hiding these off the balance sheet. Despite SenseTime's efforts to contain losses through layoffs, its cash burn will continue unabated, and the large and growing accounts receivable indicate at best an inability to recover payments and, at worst, false revenues.
Grizzly noted that SoftBank Alibaba's sale of IPO shares indicates a loss of confidence in the company. (File photo)
Major shareholders such as Alibaba and SoftBank have been selling goods for a long time
Starting in November 2022, Alibaba (11) began selling its holdings of SenseTime shares. According to the system, after Ali sold 9988 million shares at an average price of 1.819 yuan, it held 8.000 billion shares of SenseTime. As of June 22, Alibaba held approximately 71.2023 billion shares of SenseTime, accounting for 6.15% of the total issued shares. On July 5, SenseTime announced that the company had been notified by Taobao that "all its Class B shares in the Company have been sold in an orderly manner, and as of the date of the announcement, such sale arrangements have been completed", in other words, Alibaba has sold all its shares in SenseTime.
The larger shareholder, SoftBank, began selling SenseTime in December 2022, and as of July this year, SoftBank sold 12.7 million shares of SenseTime at an average price of 1.7919 yuan, holding 1.490 billion shares after the sale, accounting for 33.7% of the total number of outstanding shares.
Alibaba and SoftBank were initial investors in SenseTime prior to its IPO and disclosed in the IPO disclosure as related parties to the product and service transactions with SenseTime. But deals with the two giants have dwindled dramatically, and both sides have ruthlessly sold their IPO shares, which Grizzly believes is a sign that these large, credible counterparties have lost faith in SenseTime.
SenseTime launches new AI products in the first quarter of next year Wang Zheng: Confident in Hong Kong innovation and technology, it is rumored that there will be another large-scale layoff SenseTime: Strategic adjustment and talent structure optimizationSoftBank reduced its holdings of SenseTime by 1490.2670 million shares and cashed out 5.57 million yuan Alibaba's Taobao has sold off its holdings SenseTime refers to the existing business between the two parties will not affect the existing business between Alibaba's Taobao and sells 10 million shares of SenseTime, cashes out 1.3 billion yuan, and the shareholding ratio is reduced to 15.<>%