SOLAR equipment producer Shanghai Chaori Solar Energy Science & Technology Co.,, which last week recorded China’s first domestic bond default, said yesterday it could be delisted from the Shenzhen Stock Exchange after posting a preliminary loss for a third year in a row.

    China’s securities law states that a company has to suspend trading of its shares after making a net loss for three consecutive years and will be delisted if it fails to make a profit in the following year.

    This means Chaori Solar could be delisted if it fails to make a profit in 2014.

    China’s solar industry has suffered from severe overcapacity and falling prices for photovoltaic cells.

    Chaori Solar recorded a default last Friday, when it missed an interest payment on a bond. It warned that it would only pay out less than 5 percent of the 89 million yuan (US$14.5 million) in interest due on 1 billion yuan worth of bonds issued in 2012.

    The company suspended trading in its shares Feb. 19.

    Chaori Solar, which had 6.5 billion yuan in liabilities outstanding at the end of September, reported a 2013 preliminary net loss of 1.33 billion yuan (US$216.67 million), it said yesterday. (SD-Agencies)