The auditor of Dongyi Electronics has resigned, causing the stock price to plummet more than 30%.

Dongyi Electronics also issued a statement in the evening, attempting to reassure the public, emphasizing that the resignation of the auditor will not affect financial integrity, and stated that UHY Malaysia has been designated as the new auditor.

The company announced to the Bursa Malaysia Stock Exchange at noon today that it received a written notice from KPMG on September 9, resigning from the position of the company's auditor.

The announcement sparked concerns among investors, causing the stock price to plummet at noon, triggering a temporary trading halt and short selling suspension; eventually, it fell by 26 cents or 32.50% for the whole day, closing at 54 cents, marking a new low in the past 12 years.

After reviewing past annual reports, it was found that the company appointed KPMG as the external auditor starting from 2019, and has continued the appointment to date. According to the announcement, KPMG's resignation was voluntary.

In the afternoon's announcement, Dongyi Electronics also stated that it will actively strengthen the audit process, and has preliminarily designated UHY Malaysia as the new auditor, pending formal appointment after completion of the official documentation.

According to the company's official website, Crowe Horwath is the 19th largest accountancy firm alliance globally; meanwhile, it is also ranked 9th in Malaysia, serving over 60 listed companies.

The announcement also stated, "The financial reports for this year have not been audited by KPMG, so they will not have any impact on the financial integrity."

Dongyi Electronics' performance and stock price have been disappointing this year. In the first half of this year, the company's revenue decreased by 10.80% compared to the same period last year; net profit also fell by 3.69%.

This has also caused the stock price to plummet this year, with a drop of over 66% today, resulting in a market cap evaporation of 0.73 billion Malaysian ringgit.

It is worth mentioning that Cheryco Electronic's founder, Huang Hongzong and the Huang family, have sold a large amount of shares in the company in February this year, stepping down from the major shareholder position.

Based on the closing price of 54 cents, the stock has dropped by 73% compared to the acquisition price at that time, resulting in a book loss of MYR 1.22 million.

In addition, Dong Yi Electronics has always been the technology stock with the highest proportion of shares held by the Employees Provident Fund (EPF). According to the 2023 annual report, EPF holds approximately 89.51 million shares, equivalent to 13.26% of the equity, making it the largest shareholder of Dong Yi Electronics.

However, the EPF has sold off this stock on a large scale multiple times this year. According to the latest exchange data, as of September 2, the EPF's holdings have been reduced to 35.69 million shares, equivalent to 5.28% of the equity.