Business & Investment

Evergrande electric vehicle unit stock price fell 26% after Reuters warning

© Reuters. The company logo will appear on September 26, 2021 at the headquarters of the China Evergrande Group in Shenzhen, Guangdong Province, China. REUTERS / Aly Song

Hong Kong (Reuters)-Evergrande Group’s shares in China’s electric vehicle unit warned that the future was uncertain without a quick injection of cash and announced on Monday that it would not proceed with plans to issue shares. It plummeted by 26%. ..

The warning by the China Ever Grande New Energy Vehicle Group after the market closed on Friday was the most obvious sign that the embarrassed real estate developer’s liquidity crisis was exacerbating elsewhere in its business.

The share of the electric vehicle unit fell to HK $ 1.66 in the initial transaction before comparing the loss, which fell 2.2%. China’s Evergrande share price rose 5% and stabilized in nearly a decade. Despite last week’s lows, Evergrande’s dollar bonds were in trouble.

In the wider market, concerns have diminished that the collapse of the Evergrande Group could cause a global crisis.

“I think the market has priced the balance of probabilities, with the shock and awe over,” said Kyle Roda, an analyst at Melbourne securities firm IG Markets.

“We are really looking forward to companies that are destined to fail but are not allowed to pose significant risks within China’s financial system, or whose (contagion) does not penetrate the global market.” rice field.

Evergrande missed the deadline for dollar bonds last week. The silence on this matter suggests that investors around the world will have to swallow big losses at the end of the 30-day grace period.

The next major test in the bond market will take place on September 29, when we plan to pay $ 47.5 million in bond interest on 9.5% bonds in March 2024.

With a debt of about $ 305 billion, Evergrande was running out of cash and quickly became a headache for Beijing’s largest enterprise. Investors are concerned that the collapse could pose systemic risk to China’s financial system.

Affected developers raise money to pay many lenders and suppliers to move between troublesome meltdowns with widespread impact, controlled collapses, or the unlikely prospects of Beijing’s bailout. I’m struggling to try.

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Evergrande electric vehicle unit stock price fell 26% after Reuters warning

https://www.investing.com/news/stock-market-news/china-evergrandes-electric-car-units-shares-tumble-23-after-warning-2626821 Evergrande electric vehicle unit stock price fell 26% after Reuters warning

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