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On July 16th, Hong Kong shares of Evergrande Motor plunged 6.35% to close at HK $19.90 per share, with a total market capitalization of HK $194.4 billion. This is the fifth consecutive trading day of decline in Evergrande. From July 13 to 16, Evergrande fell 2.93%, 5.85%, 8.62%, 6.80% and 6.35% respectively. Evergrande's share price fell more than 27% in a week, down more than 70% from the high of 72.45 Hong Kong dollars per share during the year.

It is understood that since June 2020, Evergrande, whose share price was only 6 Hong Kong dollars per share at that time, suddenly soared, from 6.1 Hong Kong dollars per share in June 2020 to 72.46 Hong Kong dollars per share on February 18, 2021, an increase of more than 1000%. In other words, its share price has risen more than 10 times in less than a year. After 2000, there was a deep correction in the domestic stock market, including the share prices of car companies such as Evergrande and BYD, which fell sharply, but compared with other car companies, Evergrande's stock price correction was not very large. BYD, for example, its share price fell from 271.66 yuan per share on February 10 to 156.6 yuan per share on March 25, a drop of 37.13%, while Evergrande fell 27.48%. As we all know, BYD is the car company with the highest market capitalization in China, and it is also because the stock prices of new energy concept and lithium battery concept soared in 2020, but due to a sharp correction during the year, Evergrande successfully overtook BYD to become the largest car company in China after announcing its 2020 results.

Why can Evergrande's share price soar? In July 2020, Evergrande Health, a listed company in the Department of Evergrande, announced that it had changed its name to Evergrande Automobile. In August 2020, Evergrande released six models: Hengchi 1, Hengchi 2, Hengchi 3, Hengchi 4, Hengchi 5 and Hengchi 6. In November 2020, Evergrande officially released the Hengchi logo, which means "protect the blue sky, win the Red Sea, the Lion of the East, and be proud of the world." In February 2021, Xu Jiayin, chairman of the board of Evergrande, supervised the winter test of Hengchi, and in the same month Evergrande released three models: Hengchi 7, Hengchi 8 and Hengchi 9. In March 2021, Evergrande released the H-SMARTOS Hengchi intelligent network connection system. Evergrande shares fell back a year later, but returned to their highs on April 18, when Evergrande closed at HK $69.0 a share.

However, Evergrande's share price has continued to fall since April 19, that is, there is a lot of stimulus news in the market, but it is still unable to recover the continuous decline. Evergrande put nine Hengchi models on display at the Shanghai Auto Show on April 19, the first time Evergrande has displayed a real car in front of the public since it announced the construction of the car. Evergrande car booth was packed around on Media Day, which is enough to show Evergrande's attention in the market. It is of great significance for Evergrande to make its debut at the Shanghai auto show, but from the perspective of the secondary market, it fell by 1.3% on that day, and Evergrande's share price fell by 12.97% on Professional Public Day.

On May 12, Evergrande announced patent information for the first time: Evergrande New Energy Automobile Group (including subordinate enterprises) applied for a total of 3012 patents in China and abroad, of which 1355 patents have been authorized. These patents cover the core areas of pure electric chassis frame, suspension system, steering control, braking control, vehicle control, thermal management system, cell, battery module, battery pack, battery management system, motor and electric control, electronic and electrical framework, body and interior and exterior decoration, car networking, self-driving, manufacturing, smart charging and other core areas. On may 13th, however, Evergrande fell by 7.53%.

Evergrande announced on June 6 that Evergrande held a summer calibration test launch ceremony for five Evergrande models at Shanghai's Songjiang development base. It is understood that this summer test will be carried out in Turpan, Xinjiang, where the average daytime temperature in summer is more than 40 ℃. Hengchi 1, Hengchi 3, Hengchi 5, Hengchi 6 and Hengchi 7 will carry out a series of limit tests here to fully verify the reliability and durability of Hengchi three electricity system, thermal management strategy, braking performance, battery performance, air conditioning system and internal and external parts. Complete the durability assessment, assembly performance assessment and calibration test of the whole vehicle system. On June 7th, however, Evergrande fell by 3.66%.

We can see that after the Shanghai Auto Show, there was a lot of good news, but Evergrande's share price still could not stop falling. Some people in the industry believe that Evergrande caught up with the development of new energy vehicles in 2020, and in fact, the share prices of BYD, Lulai, Tesla and other car companies have increased significantly. However, Evergrande's share price has risen sharply, but none of the nine models that have been released have been in mass production, coupled with the impact of Evergrande Group news, which has hit market confidence to a certain extent.

Of course, the secondary market doesn't speak for itself. Take Zhongtai as an example, at present, the whole vehicle business is at a standstill, even if the intended investors announce the suspension or termination of investment, but the performance of its secondary market is very eye-catching.

According to Xu Jiayin's plan, the annual output of new energy vehicles will reach 1 million, and it will take three to five years to become the largest and most powerful new energy vehicle group in the world. At this year's Shanghai Auto Show, Evergrande announced that Hengchi will start trial production in the fourth quarter of this year and deliver it on a large scale next year. Will Evergrande's "car-building dream" come true, or will it suffocate? Maybe it can only take time to prove it!

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