(Yicai Global) Jan. 24 -- Shares of Niutech Environment Technology tumbled to a record low after the Chinese recycling equipment supplier said it was the first company at risk of being ejected from the Star Market, Shanghai’s 2 1/2-year-old sci-tech innovation board.

Niutech [SHA:688309] fell 20 percent to CNY16.49 (USD2.60) intraday, the lowest since its listing in July 2020. The equity price has been declining since last July, one year after its all-time high of CNY97.26.

The pyrolysis equipment maker will be marked as a "delisting risk stock" after the firm announces its 2021 earnings report on April 27 due to its revenue and net loss that are both likely to be less than CNY100 million (USD15.8 million), the Shandong province-based company said in a statement on Jan. 21. Consequently, trading of its shares will be restricted to a certain extent, it added.

Niutech expects its 2021 revenue to stand between CNY83 million and CNY85 million (as low as USD13.1 million) and its net loss to range between CNY20.5 million and CNY22.5 million. Neither of the figures meets the tech and innovation board's listing criteria.

"The divergence in the development of listed companies is in line with the objective laws of the capital market, and the business risks that accompany the high growth of Star Market-listed stocks cannot be ignored," an industry insider said to Yicai Global regarding Niutech's situation.

Small and medium-sized firms are less resilient to risks and they face bigger survival pressures and development problems compared to mature companies, the insider added.

Product orders fluctuate greatly, and Niutech had few new orders in 2020 due to factors including the Covid-19 epidemic, which directly affects its sales, the firm explained. However, CNY190 million worth of contracts had been signed during the fiscal year of 2021, it added.

In 2020, Niutech's revenue dropped almost 26 percent to CNY175 million, according to its earnings report. Its net profit was CNY41.6 million.

Editor: Tang Shihua, Emmi Laine, Xiao Yi