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Evergrande New Energy Vehicle Stock Jumps 51% After Company Raises $3.35B

Summary:
Last year, Evergrande showed off six new electric vehicles under a brand called Hengchi, with the hope of starting production this year.China Evergrande New Energy Vehicle Group Ltd (HKG: 708) stock closed the Hong Kong market on Monday trading at HK$ 45.35, up 51.67%. Elsewhere, China Evergrande Group (HKG: 3333) stocks closed the same market trading at HK$ 16.82, up approximately 7.72%.The sharp uptick in Evergrande related stocks is related to news that the company has raised approximately .35 billion through selling shares to private investors. Reportedly, Evergrande sold approximately 952.4 million new shares to six Hong Kong-based tycoons at .30. Notably, the sale encompassed a discount of around 9% in relation to Friday’s close.Evergrande New Energy Vehicle stocks surged over

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Last year, Evergrande showed off six new electric vehicles under a brand called Hengchi, with the hope of starting production this year.

China Evergrande New Energy Vehicle Group Ltd (HKG: 708) stock closed the Hong Kong market on Monday trading at HK$ 45.35, up 51.67%. Elsewhere, China Evergrande Group (HKG: 3333) stocks closed the same market trading at HK$ 16.82, up approximately 7.72%.

The sharp uptick in Evergrande related stocks is related to news that the company has raised approximately $3.35 billion through selling shares to private investors. Reportedly, Evergrande sold approximately 952.4 million new shares to six Hong Kong-based tycoons at $27.30. Notably, the sale encompassed a discount of around 9% in relation to Friday’s close.

Evergrande New Energy Vehicle stocks surged over 510% last year despite the company not having a single car model ready in the market. Besides, the Evergrande shares have jumped approximately 50.17% year-to-date and have added around 69.22%, 57.47%, and 58.29% in the past three months, one month, and five days respectively according to MarketWatch.

The company has a reported market valuation of approximately HK$263.62 and 8.82 billion outstanding shares.

Evergrande and the Electric Vehicle Industry

The company has been aggressive with the electric vehicle industry fueled by more willing investors to bet on the industry.

Evergrande is, however, competing with established giants like Tesla Inc (NASDAQ: TSLA), Nio Inc (NYSE: NIO), and Xpeng Inc (NYSE: XPEV). Notably, Xpeng stocks closed Friday trading at $56.39 and were up approximately 3.39% on Monday’s premarket. On the other hand, Nio stocks closed Friday trading at $61.96, up 6.19%, and were up approximately 3.05% during Monday’s premarket. While Nio stocks rallied approximately 1144.89% last year, Tesla shares rallied slightly above 658%, and Evergrande stocks managed to climb 510%.

The comparison elaborates the high competition in the electric vehicle industry both in China and overseas. The electric vehicle industry has been embraced as a measure to curb environmental degradation among other factors. Notably, China has put in place measures and mechanisms to ensure the electric vehicle industry thrives in the near future. Among other things, the country has subsidized the electric vehicle industry and welcomed global investors to focus on the sector.

Evergrande is seeking to secure a piece of the pie early enough as established companies venture out into the global market. Last year, Evergrande showed off six new electric vehicles under a brand called Hengchi, with the hope of starting production this year.

Notably, Evergrande has been involved in prior fundings whereby in late November it raised approximately HK$4 billion. The company sold off its shares to investors including Tencent and ride-hailing service Didi.

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Steve Muchoki

A financial analyst who sees positive income in both directions of the market (bulls & bears). Bitcoin is my crypto safe haven, free from government conspiracies. Mythology is my mystery! "You cannot enslave a mind that knows itself. That values itself. That understands itself."

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