Bragar Eagel & Squire, PC, a nationally recognized shareholder rights law firm, reminded investors that it has filed a class action lawsuit in the U.S. District Court for the Southern District of New York on behalf of investors who purchased RLX Technology, Inc.. New York Stock Exchange:Lux) American Depositary Shares (“ADS”) are based and/or traceable to the company’s initial public offering (“IPO” or “issuance”) on or about January 22, 2021. Investors must apply to the court for appointment as the lead plaintiff of the lawsuit before August 9, 2021.
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RLX Technology claims to be “China’s largest brand electronic steam company” and claims that this is its “largest potential market.” In January 2021, as part of the RLX Technology IPO, the defendant issued approximately 116.5 million ADS shares to the investment public at a price of US$12 per ADS, raising approximately US$1.4 billion in total proceeds.
RLX The technology class action lawsuit stated that the registration statement contained untrue statements about important facts and omitted important facts required by management regulations, as well as those necessary to make the statements not misleading. Among them, RLX The technology class action alleges that the registration statement misrepresents and omits that RLX Technology knew at the time of the IPO (or had information to make it predictable) that China was developing national standards for e-cigarettes, which would make them comply with conventional cigarette regulations.This Lixin Technology The class action further claimed that RLX Technology knew that its reported financial status was not as optimistic as the registration statement seemed, nor did it predict future results. By omitting these facts, for example, to indicate that the regulatory risk is only an accidental possibility, Lixin Technology The class action lawsuit alleges that investors were unable to adequately evaluate the value of the issued shares related to the IPO and therefore purchased their ADS without important information, which was not good for them.
Around March 22, 2021, the Ministry of Industry and Information Technology of China issued draft regulations confirming that e-cigarettes and new tobacco products will be subject to similar supervision to traditional tobacco products. Affected by this news, RLX Technology’s ADS price dropped by nearly 48%.
Then, on June 2, 2021, RLX Technology released its financial results for the first quarter of 2021, showing that its net income grew by only 48% quarter-on-quarter, and the guidance for the second quarter indicated that its gross profit margin would only “stay”. Affected by this news, RLX Technology’s ADS price dropped another 9%. At the beginning of this operation, RLX Technology’s ADS transaction price was more than 32% lower than the IPO issue price.
If you purchased RLX ADS based on the IPO and/or traceable to the IPO and suffered losses, have information, would like to learn more about these claims, or have any questions about this announcement or your rights or interests in these matters, please Contact Brandon Walker, Melissa Fortunato or Marion Passmore via email to Investigate @bespc.com, Call (212) 355-4648, or pass Fill out this contact form. You do not have to bear any costs or obligations.
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Bragar Eagel & Squire, PC is a nationally renowned law firm with offices in New York, California and South Carolina. The company represents individual and institutional investors in commercial, securities, derivatives, and other complex litigations in state and federal courts across the country.For more information about the company, please visit www.bespc.com. Attorney ads. The previous results do not guarantee similar results.