Home Business Evergrande Stock Soars 42% in 15-Minute Trade Resumption

Evergrande Stock Soars 42% in 15-Minute Trade Resumption

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Evergrande Stock Soars 42% in 15-Minute Trade Resumption

Shares of troubled Chinese real estate developer Evergrande experienced a surge of up to 42% when trading resumed on Tuesday. The stock had been suspended last Thursday after news broke that the company’s chairman, Hui Ka Yan, was under police surveillance. Evergrande issued a statement confirming that Hui was subject to “mandatory measures” related to “suspicion of illegal crimes.” The company’s stock prices have been highly volatile, with trading resuming in August after a suspension that began in March 2022. Evergrande, which had over $300 billion in liabilities at the end of 2022, filed for bankruptcy protection in the US in August.

Despite the resumption of trading, Evergrande’s financial troubles persist. The company cancelled key creditor meetings in late September as part of its debt-restructuring efforts and announced its inability to issue new debt. Additionally, its main domestic unit, Hengda Real Estate Group, failed to make payments on a bond worth 4 billion Chinese yuan ($547 million) due on September 25. While the stock initially surged, the gains have since been pared down, and it is currently 17% higher at 38 Hong Kong cents.

Overall, Evergrande’s stock experienced a significant increase after trading resumed, following the suspension due to the chairman’s police surveillance. However, the company continues to face financial difficulties, as evidenced by its debt restructuring efforts and failure to make bond payments. Investors remain cautious about the future prospects of Evergrande amidst its ongoing crisis.

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