Shares of China Evergrande Group’s electric vehicle unit are collapsing in Hong Kong, wiping about $80 billion from what was the property developer’s most valuable listed asset.
China Evergrande New Energy Vehicle Group sank as much as 22 per cent on Thursday after its parent said the unit lost 4.8 billion yuan ($740 million) in the first half of 2021.
The EV business’s market value was about $87bn at its April 16 peak, greater than that of Ford Motor and almost four times the capitalisation of China Evergrande itself at the time. Evergrande NEV shares are down 92 per cent since then, the worst performance in the Bloomberg World Index and lagging behind even China’s tutoring stocks.
Evergrande’s subsidiaries are being punished by investors over concerns that the world’s most indebted developer will need to sell assets at a steep discount amid mounting pressure from Beijing. Shares of listed businesses – including the 65 per cent stake it owns in Evergrande NEV – are the most liquid if Evergrande needs to generate cash quickly. Evergrande in May raised $1.4bn from the unit in a heavily discounted share sale.
“It’s very obvious that Evergrande New Energy is short of money,” said Castor Pang, head of research at Core Pacific-Yamaichi International. “Now that the parent company has a liquidity problem, it’s impossible for Evergrande New Energy to meet previous targets for car production.”
The electric car upstart was already a capital-intensive project for Evergrande chairman Hui Ka Yan, who funnelled billions of yuan into the business in an attempt to make it “the world’s largest and most powerful new energy vehicle group” by 2025. Previously known as Evergrande Health Industry Group before a name change last year, the company still generates the majority of its revenue from its health business.
Speaking on an earnings call in late March after Evergrande NEV’s full-year loss for 2020 widened by 67 per cent, Mr Hui said the company planned to begin trial production of cars at the end of this year, delayed from an original timeline of last September.
This month, Evergrande said it was in talks with “several independent third-party investors” to sell stakes in the electric vehicle and property services subsidiaries. It is selling a Hong Kong development project at a loss, sources said this week.
Almost 93 million Evergrande NEV shares changed hands on Thursday, about seven times this year’s daily average. The stock closed down 19 per cent at HK$5.18 ($0.66), the lowest price since March 2020.
The specs
- Engine: 3.9-litre twin-turbo V8
- Power: 640hp
- Torque: 760nm
- On sale: 2026
- Price: Not announced yet
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Our family matters legal consultant
Name: Dr Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
The specs: 2018 Nissan 370Z Nismo
The specs: 2018 Nissan 370Z Nismo
Price, base / as tested: Dh182,178
Engine: 3.7-litre V6
Power: 350hp @ 7,400rpm
Torque: 374Nm @ 5,200rpm
Transmission: Seven-speed automatic
Fuel consumption, combined: 10.5L / 100km
The%20specs
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UAE currency: the story behind the money in your pockets
UAE currency: the story behind the money in your pockets
'The worst thing you can eat'
Trans fat is typically found in fried and baked goods, but you may be consuming more than you think.
Powdered coffee creamer, microwave popcorn and virtually anything processed with a crust is likely to contain it, as this guide from Mayo Clinic outlines:
Baked goods - Most cakes, cookies, pie crusts and crackers contain shortening, which is usually made from partially hydrogenated vegetable oil. Ready-made frosting is another source of trans fat.
Snacks - Potato, corn and tortilla chips often contain trans fat. And while popcorn can be a healthy snack, many types of packaged or microwave popcorn use trans fat to help cook or flavour the popcorn.
Fried food - Foods that require deep frying — french fries, doughnuts and fried chicken — can contain trans fat from the oil used in the cooking process.
Refrigerator dough - Products such as canned biscuits and cinnamon rolls often contain trans fat, as do frozen pizza crusts.
Creamer and margarine - Nondairy coffee creamer and stick margarines also may contain partially hydrogenated vegetable oils.
Venom
Director: Ruben Fleischer
Cast: Tom Hardy, Michelle Williams, Riz Ahmed
Rating: 1.5/5
Premier League results
Saturday
Tottenham Hotspur 1 Arsenal 1
Bournemouth 0 Manchester City 1
Brighton & Hove Albion 1 Huddersfield Town 0
Burnley 1 Crystal Palace 3
Manchester United 3 Southampton 2
Wolverhampton Wanderers 2 Cardiff City 0
West Ham United 2 Newcastle United 0
Sunday
Watford 2 Leicester City 1
Fulham 1 Chelsea 2
Everton 0 Liverpool 0
Zakat definitions
Zakat: an Arabic word meaning ‘to cleanse’ or ‘purification’.
Nisab: the minimum amount that a Muslim must have before being obliged to pay zakat. Traditionally, the nisab threshold was 87.48 grams of gold, or 612.36 grams of silver. The monetary value of the nisab therefore varies by current prices and currencies.
Zakat Al Mal: the ‘cleansing’ of wealth, as one of the five pillars of Islam; a spiritual duty for all Muslims meeting the ‘nisab’ wealth criteria in a lunar year, to pay 2.5 per cent of their wealth in alms to the deserving and needy.
Zakat Al Fitr: a donation to charity given during Ramadan, before Eid Al Fitr, in the form of food. Every adult Muslim who possesses food in excess of the needs of themselves and their family must pay two qadahs (an old measure just over 2 kilograms) of flour, wheat, barley or rice from each person in a household, as a minimum.
Company%C2%A0profile
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Groom and Two Brides
Director: Elie Semaan
Starring: Abdullah Boushehri, Laila Abdallah, Lulwa Almulla
Rating: 3/5
How to help
Call the hotline on 0502955999 or send "thenational" to the following numbers:
2289 - Dh10
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Civil%20War
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