Enjoyor Technology in the new situation, risk resolution is ongoing.

After the introduction of the new "National Nine Provisions", under the background of comprehensive implementation of "long teeth and thorns" in financial regulation, the delisting efforts of A shares continued to increase. Along with the escalating delisting crisis, the impact on ST stocks is particularly significant. As of the closing on July 22nd, the ST sector has accumulated a decline of over fifty percent for the year, with stock prices being effectively "halved". With individual stocks in the sector experiencing mixed fortunes, the mindset of on-site investors is bound to undergo various changes. Although a company being "flagged" for delisting does not necessarily mean it will delist, there have been numerous cases in history where companies successfully removed the "flag". However, in the current market environment, many investors still choose to stay away from ST stocks. Indeed, under the new "National Nine Provisions", the scope and connotation of "ST" have expanded, and from a global perspective, the investment value of ST stocks has declined compared to previous years. However, from a different perspective, the capital market has always followed the law of risk and reward, and while stocks under "special treatment" certainly carry higher risks, successful removal of the "flag" in the future could potentially yield much higher returns than the overall market. Taking a comprehensive look at ST stocks in both markets, it is noticeable that among the companies that have been flagged for delisting risk warnings, there are indeed some "potential stocks" that dominate high-quality tracks and possess strong technological attributes. For example, consider Enjoyor Technology (300020.SZ), which was recently "flagged". This tech company, which is currently undergoing a strategic transformation in the digital city operations services sector, was one of the first companies listed on the ChiNext board, and had a golden era in its early years. However, at this critical juncture, Enjoyor Technology, at its "prime age", is facing development bottlenecks, with increased profit pressures and internal control deficiencies leading to a sharp decline in its stock price amidst negative news. It is no secret that Enjoyor Technology, currently "flagged", urgently needs to race against time to quickly reverse its operational difficulties in order to retain its listing status. Meanwhile, for secondary market investors, when a company they hold encounters "growing pains", it may be wise to pay more attention to companies with potential growth while calmly assessing the risk of delisting. "Falling" performance, "hidden" opportunities? Established in 1992, Enjoyor Technology has built a nationwide business layout since its listing on the ChiNext board in 2009. Currently, it provides construction and operation services for urban digitization and industrial digitization through a model that integrates software design, system delivery, and data operation. In recent years, with the acceleration of the digital economy and the importance of computing power as a driving force for social and economic development, data has become a core production factor. In line with this trend of the times, Enjoyor Technology has comprehensively transformed into a service provider for urban construction and operation. During the transformation process, Enjoyor Technology has achieved a series of phased development accomplishments. For example, in 2023, building on its existing technological foundation, Enjoyor Technology further developed the "Yinjiang City Brain Support Platform", which centers around data and intelligence, to provide one-stop services for data governance. Moreover, in the same year, Enjoyor Technology launched dozens of innovative products and released industry-specific models such as Yinjiang Tongming Government Affairs for grass-roots governance, Yinjiang Tongming Transportation for traffic control, and Tongming Health for health services. Additionally, Enjoyor Technology established the Yinjiang Intellectual Computing Center to support its digital city business with computing power. In terms of market expansion, over the past year, Enjoyor Technology has established urban brain technology companies in ten provinces including Fujian, Guangdong, and Xinjiang, and has expanded into various urban brain markets. Despite vigorous transformation efforts focused on digital city operations services, the efficacy of the changes has yet to be reflected in the company's performance. According to Enjoyor Technology's 2023 annual report, due to the impact of business structure adjustments, the company's revenue in 2023 was 11.69 billion yuan, a decrease of over twenty percent compared to the previous year; at the same time, the net profit attributable to shareholders was -234 million yuan, marking the first full-year loss in the company's over ten years of listing. Entering 2024, Enjoyor Technology still faces residual performance pressures. Data shows that in the first quarter of this year, Enjoyor Technology's revenue was 4.64 billion yuan, with a net profit attributable to shareholders of 10.47 million yuan, indicating that the business scale is still in decline. It is not uncommon for innovative companies to face performance pressures during the incubation period of their business. After all, early-stage innovation activities often require significant investment, and new business models also need time to validate their viability and market acceptance. In this process, the company's poor short-term performance is within expectations. However, it can be largely confirmed that the direction of transformation chosen by Enjoyor Technology will be one of the most promising paths for future development in China. The latest evidence for this comes from Liu Liehong, director of the National Bureau of Statistics, who stated on July 22nd at a press conference of the State Council Information Office titled "Promoting High-Quality Development" that they will cultivate and strengthen data enterprises, and build a data industry that is orderly, prosperous, and active. As the data industry is vast and continuously evolving, Enjoyor Technology, positioned within it, may be able to rely on the power of innovation to turn its predicament around. After all, the company's new products are currently being iterated and upgraded intensively, and with the help of industry trends, Enjoyor Technology still has the potential to open up new growth prospects. Resolutely tackling risks, waiting patiently for a turnaround in operations In addition to the unresolved performance challenges, Enjoyor Technology, in the midst of transformation, also needs to address a series of risks associated with its operations. PreviouslyEnjoyor Technology stated in response to the Shenzhen Stock Exchange's inquiry letter that due to a series of lawsuits and arbitration cases, a total of 313 million yuan in funds in the company's bank accounts have been frozen. The total lawsuit amount involved in the freeze is approximately 533 million yuan. The company may face further freezing of funds in its other bank accounts.As of the beginning of last month, Enjoyor Technology had available funds of only about 0.6 billion yuan, but the total bank financing debt with interest due within a year was about 14.75 billion yuan, with 1.80 billion yuan due in June, 2.55 billion yuan due in July, and 1.89 billion yuan due in August. It is not difficult to see that Enjoyor Technology's cash flow is currently very tight. Faced with the crisis, Enjoyor Technology is fully committed to resolving the risks. It is understood that Enjoyor Technology is actively communicating with the government and partner banks to explain the current situation. At the same time, in order to overcome the historical legacy of slow receivables and high accounts receivable issues, Enjoyor Technology has specially set up a receivables team to strengthen the collection of accounts receivable and negotiate with suppliers to extend payment terms. In addition, Enjoyor Technology is actively looking for opportunities to sell other financial assets to revitalize existing assets. Meanwhile, Enjoyor Technology's controlling shareholder, Silver River Technology Group, is also working tirelessly to resolve the risks. According to public information, most of Silver River Technology Group's shareholdings in Enjoyor Technology are currently pledged or judicially frozen. Therefore, Enjoyor Technology's controlling shareholder, Silver River Technology Group, is actively resolving the funding issues through debt recovery, asset pledge or sale, equity pledge or transfer of other investment projects, in order to reach a settlement with creditors and eliminate hidden risks. Indeed, based on the existing information, it is currently difficult to determine whether the operational difficulties faced by Enjoyor Technology are temporary or long-term, and it is also difficult to directly assert whether the company's transformation pace and results can meet the expectations of the company and investors. However, on the positive side, in the face of the changing situation, Enjoyor Technology has not just passively responded, but has fully committed to resolving risks and accelerating the development of new growth points. Furthermore, taking a step back, in the current market environment, Enjoyor Technology's stock price performance may have already fully priced in various pessimistic expectations of the market. Therefore, while calmly assessing the risks, investors may also pay more attention to companies like Enjoyor Technology that still have growth potential.