Evergrande resumes trading in Hong Kong
HONG KONG
Shares in troubled Chinese property giant Evergrande plummeted more than 80 percent in Hong Kong yesterday morning after the lifting of a 17-month trading suspension.
The resumption of trading came after the company said in a filing on Aug. 25 that it had met guidelines set out by the bourse, including belatedly publishing its financial results and complying with other listing rules.
Once China's largest real estate firm, Evergrande defaulted in 2021 and is saddled with more than $300 billion in liabilities, becoming a symbol of the nationwide property crisis that many fear could spill over globally.
Its shares plunged 86.67 percent at the open.
The company on Aug. 27 reported fresh losses for the first half of the year amounting to 33 billion yuan ($4.53 billion) - an improvement on the 66.4 billion yuan in losses reported in the same period last year.
But its cash assets fell from $2 billion last year to $556 million, reflecting its dwindling liquidity.
Earlier this month, the company filed for bankruptcy protection in the United States, a measure to protect its U.S. assets during its restructuring.
The company is also fending off winding-up petitions in Hong Kong courts, with one case adjourning its hearing to October.
In March 2022, the Hong Kong stock exchange suspended trading in Evergrande shares after the company failed to publish its 2021 financial results.
The results for 2021 and 2022 were published last month, showing a net loss of more than $113 billion over the two-year period.
China's real estate sector has proven to be a stumbling block as the world's second-largest economy tries to break out of a post-Covid slump.
Fellow Chinese property developer Country Garden now risks defaulting on its bond payments next month, with the company saying there are "major uncertainties in the redemption of corporate bonds".
