An investor in shares of Uxin Limited (NASDAQ: UXIN) filed a lawsuit over alleged violations Securities Laws by Uxin Limited in connection with certain allegedly false and misleading statements made in connection with the Company’s June 27, 2018, initial public offering (“IPO”).
China based Uxin Limited, through its subsidiaries, operates an used car e-commerce platform in China. Uxin Limited reported that its annual Total Revenue rose from 824.50 million CNY in 2016 to over 1.91 billion CNY in 2017 and that its Net Loss increased from over 1.35 billion CNY in 2016 to over 2.72 billion CNY in 2017.
On November 19, 2018, Uxin Limited reported that transaction volume for one of its business segments had declined 8.5% year-over-year and gross merchandise value had declined 14.8% due to its “recent change of approach in serving customers with car-selling needs.”
Shares of Uxin Limited (NASDAQ: UXIN) declined to as low as $2.81 per share on December 4, 2018.
According to the complaint the plaintiff alleges that the Registration Statement was materially false and misleading and omitted to state that the company was likely to stop providing complementary services such as inspections to its customers, that instead, the company would connect consumers to dealers who would provide such complementary services, that as a result, the company’s 2B business would be materially impacted, and that as a result of the foregoing, defendants’ statements in the Registration Statement regarding Uxin’s business, operations, and prospects, were materially false and/or misleading.