China's 'perfume first stock' spent HK$70M on PR prepayments — then its auditor quit

Eternal Fragrance Group (颖通控股, HKEX: 06883) listed in Hong Kong in 2025 as 'China's first perfume stock,' distributing international fragrance brands including Hermès, Van Cleef & Arpels, Chopard, Bvlgari and Chloé. The IPO was priced at HK$2.88 per share, but the stock broke its issue price on the first trading day, closing at HK$2.40.

Shortly after listing, the company made HK$70 million (approximately RMB 60.55 million) in prepayments to three suppliers, described as being for public relations and marketing services. When auditor PricewaterhouseCoopers requested a reasonable explanation, supplier background information and details on how the funds were used, Eternal Fragrance failed to provide the requested response. PwC resigned as auditor on March 16, 2026. Shares were suspended the following day.

The suspension has continued with no definite resumption date. The Hong Kong Stock Exchange issued four conditions for resumption: complete the independent investigation, confirm management integrity, conduct an internal-control review, and make comprehensive disclosure. The company's annual results remain delayed. Before suspension, the stock had fallen nearly 30% from its IPO price. The crisis also coincided with the closure of Santa Maria Novella stores in Shanghai and Hong Kong, brands that Eternal Fragrance distributed.