by Zhang Shidong at scmp.com
A slump in the shares of China Evergrande New Energy Vehicle Group, the electric-vehicle (EV) unit of debt-ridden property developer China Evergrande Group, wiped out US$2.7 billion in market value after trading resumed following a suspension of 16 months.
Evergrande NEV plunged by as much as 69 per cent to HK$1 on Friday, trading for the first time since March 31 last year on the Hong Kong stock exchange. It recouped some of its losses to close 61 per cent lower at HK$1.24, with around 465 million shares, or 4 per cent of its outstanding shares, changing hands.
The company fulfilled the bourse’s requirements to resume trading after disclosing overdue annual reports for 2021 and 2022, showing sufficient levels of operations and assets warranted for the listing status and providing investors with necessary information to assess the outlook, it said in an exchange filing on Thursday night.
The sell-off underscores investors’ mounting concern about the company’s ability to remain afloat, as its parent China Evergrande Group has been bogged down by daunting debt restructuring efforts. Evergrande NEV had liabilities of 183.9 billion yuan (US$25.7 billion) and assets of 115.2 billion at the end of last year, according to its latest annual result released on Wednesday. The company’s shares have lost 98 per cent of their value since hitting an all-time high on February 17, 2021.read more