Hong Kong, China– Shares in the electric vehicle subsidiary of Chinese property giant Evergrande plunged almost 70 percent on Friday as they resumed trading in Hong Kong after being suspended for more than 15 months.
Officials called a halt to dealing in China Evergrande New Energy Vehicle Group (NEV) on April 1 last year after it failed to release its financial results.
The company on Wednesday announced its earnings for 2021 and 2022 — showing a loss of almost $12 billion — and returned to the Hong Kong stock market Friday morning.
But soon after the opening bell, the firm tanked 69 percent before paring the losses slightly.
NEV is a unit of China Evergrande, once China’s biggest developer but now drowning in more than a sea of debt and a symbol of the country’s widespread property crisis.
Fears of a collapse of the firm in 2021 sent shudders through the world’s number two economy and fanned fears of a global contagion.
The car unit was launched in 2019 to compete with Elon Musk’s Tesla, though it has had mixed results and last year sold only 320 vehicles in China, compared with the more than 74,000 sold in June by its rival.
In its financial results posted Wednesday, NEV said its debt hit 183.9 billion yuan ($25.6 billion) at the end of December 2022.
The electric car market in China is particularly competitive, with many local manufacturers emerging in recent years.
Trading in Evergrande remains suspended, though it finally released its own financial results earlier this month, revealing its liabilities had ballooned to $340 billion.
The company this year announced a debt restructuring proposal, offering creditors a choice to swap their debt into new notes issued by the company and equities in two subsidiaries, Evergrande Property Services Group and NEV.