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SHANGHAI (Reuters) - China's stock regulator has moved to cool speculative fever around plans to build a massive economic zone near Beijing, warning several listed companies against misleading investors with bombastic hypes around the red-hot theme.
China has unveiled plans to build Xiongan New Area, a "thousand-year project" which official media described as carrying the same national significance as the Shenzhen Special Economic Zone that helped kick-start China's economic reforms in 1980.
The new economic zone immediately became the hottest investment theme in China's stock market, with dozens of "Xiongan" concept stocks surging as investors piled into companies that will potentially benefit from the scheme.
In the real estate market though, speculation around Xiongan has been muted by Beijing's tough controls on property development and transactions. [L3N1HE3MZ]
But companies including Beijing Jiayu Door Window and Curtain Wall Joint-Stock Co and software maker Beijing Egova Co raised eyebrows from regulators after the their discussions with investors about Xiongan boosted share prices.
In a statement published late on Friday, Beijing Jiayu said that it had received a letter from the Shenzhen Stock Exchange, warning the company against using "exaggerative" language in describing future investment, or using hot topical events to mislead investors.
The bourse also urged Jiayu to detail its investment plans around Xiongan and submit feasibility reports, after the company told investors via an on-line platform on Tuesday that it would build regional headquarters in the Xiongan New Area.
Beijing Egova said in a public filing that the company's communications with investors about business opportunities in Xiongan was also challenged by the Shenzhen Stock Exchange.
Vowing to make corrective measures, Egova said: "We will adamantly follow the exchange's order ... and refrain from using hot topics in the stock market to influence investors' judgment on the company's value in an inappropriate manner."
In addition, over a dozen companies have put out statements disclosing potential business impacts from the newly announced economic zone, which the official China Securities Journal said was the result of regulatory guidance on disclosure aimed at curbing speculation.
Chinese regulators have been tightening disclosure rules to discourage listed firms from using hot topics to pump up share prices as part of efforts to curb speculation.
In a most infamous case, shares of loss-making property developer Shanghai Doulun Industry Co doubled in 2015 after the company changed its name to P2P to stir up investor interest at a time when internet finance was a hot investment theme. The stock has since tumbled over 60 percent from its peak.
Editing by Michael Perry