In May last year, the share price of Baotou Steel Co., Ltd. fell to around 1 yuan-according to the new delisting rules of the CSRC, if the share price falls below 1 yuan for 22 consecutive trading days, then listed companies are at risk of delisting.

In order to avoid this risk, Baosteel Group, the major shareholder of Baotou Steel, issued an announcement to increase its holdings-to buy 2-4 billion yuan of its own shares in the next 1 year. As a result, a year later, Baotou Steel Group, as a state-owned enterprise, reneged on its word-only paid 250 million yuan, which was a huge difference from the lowest 2 billion yuan, so the Shanghai Stock Exchange gave this punishment. Later, Baotou Steel Group also came out to argue that although it only bought 250 million shares the year before last, it took Baotou Steel Group and Northern Rare Earth three months to buy 800 million shares after July 5 this year. According to the attitude of the exchange, the adverse effects caused by the failure to fulfill the previous increase plan have been eliminated to a certain extent and can be considered as appropriate.

Coincidentally, there is a policy document in the market that is particularly beneficial to rare earth permanent magnets. It happens that the motor downstream of rare earth is stimulated by the policy document, which makes Baotou Steel in a situation where both advantages and disadvantages exist.