China Evergrande NEV shares plummet 7% on bankruptcy woes

China Evergrande New Energy Vehicle’s shares plunged seven per cent in Monday morning trading after individual creditors of two of its subsidiaries filed applications with a local court seeking bankruptcy proceedings and reorganisation.

The electric car manufacturer confirmed in a filing to the Hong Kong Stock Exchange late on Sunday that its units, Evergrande New Energy Vehicle (Guangdong) and Evergrande Smart Automotive (Guangdong), had received official notification from the court regarding the July 25th application.

The filing further stated that “the above notice has a material impact on the production and operating activities of the company and the relevant subsidiaries.”

This news sent shockwaves through the market, causing the company’s share price to plummet to HK$0.295. Year-to-date, China Evergrande New Energy Vehicle’s stock price has suffered a significant decline of nearly 40 per cent.

$1 = HK$7.8068 (as of July 29, 2024)

Attribution: Reuters