(Yicai Global) April 13 -- Shares of Weifu High-Technology Group plunged by the exchange-imposed daily trading limit after the Chinese auto parts maker said one of its units may have been encountered contract fraud.

Weifu [SHE: 000581] closed 10 percent down at CNY17.74 (USD2.58) a share today, cutting its market capitalization to CNY17.9 billion (USD2.6 billion).

Weifu International Trading was in touch with some of its clients when it found inconsistencies with some receivables, so it concluded that it was likely the subject of contract fraud, the Wuxi-based parent company announced late yesterday.

If the company does not collect the receivables in full, Weifu International Trading’s current and future profits may be greatly affected, it added.

Wuxi’s Public Security Bureau has decided to file the criminal case for investigation, but due to uncertainties, the bureau cannot estimate its impact for the time being.

Founded in 1958, Weifu is a renowned car parts maker with 18 wholly-owned and holding subsidiaries and two joint ventures. It employs nearly 8,000 people worldwide.

In the first three quarters of last year, Weifu’s net profit fell 27 percent to CNY1.6 billion (USD233 million) from a year earlier. Revenue dropped 18.4 percent to CNY10.1 billion.

Editor: Futura Costaglione