Wuchan Zhongda: Subsidiary's CNY 49m lawsuit enters enforcement

Wuchan Zhongda Group Co., Ltd. (SSE:600704) announced that its controlling subsidiary, Zhongda Leasing, has received notice from the Hangzhou Intermediate People's Court regarding the enforcement of a judgment against Zhejiang Qingfeng Native Culture Co., Ltd. and related parties. The lawsuit, initiated by Zhongda Leasing in April 2024, sought payment of a transfer price and penalties totaling CNY 62.23 million. In January 2025, the court ruled in favor of Zhongda Leasing, ordering Qingfeng Culture to pay CNY 48.86 million for the transfer and penalties (calculated at an annual rate of 12% on a base of CNY 35 million since January 1, 2021), with Zhao Ruiyong and Zhao Feifan bearing joint and several liability. Zhongda Leasing has now applied for enforcement of this judgment. The company has already accounted for impairment provisions related to this matter in its 2024 annual report. The ultimate impact on the company's profits remains uncertain.