Evergrande's electric car unit's shares tumble 26% after warningONG KONG, Sept 27 (Reuters) - Shares of China Evergrande's electric car unit 0708.HK plunged as much as 26% on Monday after it warned it faced an uncertain future unless it got a swift injection of cash and after it said it will not proceed with plans to issue RMB shares.
The warning by China Evergrande New Energy Vehicle Group after the market closed on Friday was the clearest sign yet that the embattled property developer's 3333.HK liquidity crisis is worsening in other parts of its business.
Shares of the electric car unit slid to as low as HK$1.66 in early trade before paring losses to fall 2.2%. China Evergrande's stock rose 5% to steady near the decade-low they made last week, while Evergrande dollar bonds were at distressed levels.
In the broader market, concerns that a collapse at Evergrande could drive a global crisis have ebbed.
"I think the markets have priced in that on the balance of probabilities, the shock and awe is over," said Kyle Rodda, analyst at brokerage IG Markets in Melbourne.
"Markets are really just expecting from here on in, a company that is doomed to failure but one which won't be allowed to result in major risks within the Chinese financial system - or that (contagion) won't pervade global markets."
Evergrande missed a payment deadline on a dollar bond last week and its silence on the matter has left global investors wondering if they will have to swallow large losses when a 30-day grace period ends. (Full Story)
