The Chinese electric car manufacturer Evergrande, a subsidiary of the real estate group of the same name, returned to the Hong Kong stock exchange on Friday after more than 15 months. The share price fell by more than 60 percent by the close of trading. The stock exchange suspended trading in April 2022 because Evergrande NEV was repeatedly unable to present a balance sheet.
Evergrande NEV started 2019 with big announcements. The carmaker should compete with the US company Tesla and overtake it within five years. The financial difficulties of the parent company also brought the daughter into a tailspin. The real estate developer is said to have accumulated debts of more than 300 billion euros by the end of 2022 and was on the verge of bankruptcy for months. In March, the group unveiled a restructuring plan – part of which was an offer to creditors to give them stakes in its subsidiaries, including Evergrande NEV.
Company writes big loss
The automaker finally presented figures on Wednesday. In 2021, the company made a loss of 56.3 billion yuan (7.1 billion euros), in 2022 another 27.6 billion yuan (3.5 billion euros) – the equivalent of around 10.6 billion euros. The debt amounted to around 23.2 billion euros at the end of 2022.
The parent company is also currently having problems. The highly indebted Chinese construction company has one for the years 2021 and 2022 Net loss of the equivalent of 100 billion euros reported.
The group’s shares have been suspended from trading on the Hong Kong Stock Exchange since March 2022. In the same month, Evergrande announced that it would not be able to submit its audited annual report for 2021 on time. Earlier, the real estate giant announced that its debt had grown to 1.97 trillion yuan ($300 billion) and that there was a risk of default.
In 2022, Evergrande’s car division actually started production after many delays, and the first Hengchi 5 model rolled off the assembly line. According to the company, 320 copies have been sold so far China.