Evergrande Shares Surge After Trading Resumes Following Chairman’s Surveillance

Shares of Evergrande, the embattled Chinese real-estate developer, skyrocketed by 42% in just 15 minutes after trading in the stock resumed on Tuesday. The Hong Kong-listed shares were suspended last Thursday amidst reports of the company’s chairman, Hui Ka Yan, being placed under police surveillance. Evergrande stated that Ka Yan has been subjected to mandatory measures due to suspicions of illegal activities. The firm also clarified that there is no additional internal information relating to the company that needs to be disclosed.

This recent surge in Evergrande’s share prices adds to the already highly volatile nature of its stock. In August, trading had resumed on the Hong Kong stock exchange, following a 17-month suspension that began in March 2022. This move came after the real-estate giant, burdened with over $300 billion worth of liabilities, filed for bankruptcy protection in the United States on August 17. However, the company’s financial troubles have continued to worsen.

In late September, Evergrande canceled important meetings with creditors as part of debt-restructuring attempts and announced its inability to issue new debt. Additionally, its main domestic unit, Hengda Real Estate Group, failed to make payments on a 4 billion Chinese yuan, or $547 million, bond due on September 25, including the principal and interest. Despite the initial surge in share prices, Evergrande shares have since retreated, currently standing 17% higher at 38 Hong Kong cents as of 11:06 a.m. Hong Kong time on Tuesday.

Source: Evergrande shares jumped 42% within 15 minutes of resuming trade amid investigation woes