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China property giant Evergrande suspends Hong Kong market trading

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Evergrande suspended trading in its shares on the Hong Kong Stock Exchange.

Hong Kong:

Property giant China Evergrande on Monday suspended trading in its shares on the Hong Kong Stock Exchange without assigning any reason.

The company’s stock price has fallen nearly 80 percent since the beginning of the year as it struggles under a mountain of debt on the brink of collapse.

“Trade in China Evergrande Group shares will be halted,” it said in a statement to the exchange. “Accordingly, all structured products belonging to the company will also be debarred from trading at the same time.”

Shares of its electric vehicle company, which last week scrapped a proposed Shanghai listing, were not suspended, though they fell six percent in early trading.

Firm executives are struggling to deal with a crisis that has left it more than $300 billion in debt, sparking fears of a contagion for the broader Chinese economy that some warn could spread globally.

Last week it said it would sell a $1.5 billion stake in a regional Chinese bank to raise much-needed capital as it struggles to make interest payments to bondholders.

Beijing has been silent on the property empire’s woes, but state media have retold various reactions to the mood of a private company that has grown on a debt binge in the years of the Chinese real estate boom.

Officials have asked local governments to prepare for Evergrande’s possible collapse, with reports unlikely to suggest a major state bailout.

The liquidity crunch has sparked public anger and rare protests outside its offices in China as investors and suppliers ask for their money back.

The group acknowledged facing “unprecedented challenges” and warned that it may not be able to meet its liabilities.

The country’s real estate sector has been under intense scrutiny in recent months, with regulators last year announcing caps for three different debt ratios in a scheme called the “three red lines”.

(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)

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