AutoBeta(AutoBeta.net)08/28 Report--

On the evening of Aug. 27, Evergrande issued a profit warning announcement that it expected to record a consolidated net loss of about 20.254 billion yuan in the first half of this year, compared with a net loss of about 6.873 billion yuan in the same period, an increase of 194.7 percent compared with the same period last year. Evergrande said that the increase in losses was mainly due to the fact that Evergrande Group had been wound up by the Hong Kong High Court, and the company increased its provision for impairment of accounts receivable from subsidiaries and associates of Evergrande Group, with a full provision of about 16.737 billion yuan in the first half of 2024.

At present, Evergrande is going through the most difficult survival crisis in history, under the influence of a series of events, such as factory shutdown, bankruptcy reorganization of subsidiaries, sustained financial losses and so on, trying to save itself by introducing potential third-party investors. and it didn't bear fruit.

On the evening of June 11, Evergrande announced that the relevant subsidiaries have recently received further administrative decisions issued by the relevant local administrative departments as follows: (1) rescind three of the relevant agreements; (2) the relevant subsidiaries return a total of about 1.9 billion yuan of awards and subsidies to the relevant local administrative departments within 15 days from the date of receipt of the administrative decision. At the same time, Evergrande said that its subsidiary Evergrande New Energy vehicle (Tianjin) Co., Ltd. recently received a notice from another relevant department, which verified the maintenance of production access conditions for new energy passenger vehicle products in Tianjin Evergrande, and put forward three issues requiring rectification, and intended to order Tianjin Evergrande to stop producing and selling new energy passenger vehicle products, and to carry out rectification. During the rectification and reform period, the department will suspend the acceptance of Tianjin Evergrande's declaration of new products for new energy passenger vehicles and the transmission of electronic information on the qualification certificate of new energy passenger vehicles, which will be restored after the rectification and reform is completed and the production access conditions are met through review.

On August 5, Evergrande issued a notice that the relevant local people's court held a hearing on the bankruptcy reorganization of the relevant subsidiary on August 2, 2024, and the relevant local people's court ordered the relevant subsidiary to enter the bankruptcy reorganization procedure. It is understood that the above two bankruptcy restructuring companies are the main companies of Evergrande's vehicle production base in Nansha, Guangzhou, which basically completed the main body construction in 2020, but has not been qualified for vehicle production and has not been put into operation.

Evergrande, which has suffered a serious crisis, is trying to save itself by bringing in potential third-party investors. On May 26, Evergrande announced that 29% of its shares will be acquired by potential buyers, who will provide credit to Evergrande to finance the company's continued operation and development of its electric vehicle business. Up to now, however, the white knight of Evergrande has not appeared. On August 26, Evergrande said that discussions between potential sellers, potential buyers and the company were still ongoing, but there was no sale and purchase agreement between potential sellers and potential buyers, and no credit agreement between potential buyers and the company. Evergrande highlighted the uncertainty of the potential deal.

At present, Evergrande has not yet disclosed its interim results report. As of December 31, 2023, the cumulative loss of Evergrande has reached 110.841 billion yuan, of which the loss in 2023 is about 12 billion yuan. By the end of 2023, Evergrande had total automobile assets of 34.851 billion yuan and total liabilities of 72.543 billion yuan, which was seriously insolvent. Affected by the news, Evergrande's latest share price is 0.275 Hong Kong dollars, with a market capitalization of only 2.98 billion Hong Kong dollars. Since its inception, Evergrande has only one Hengchi 5 to achieve mass production, the cumulative delivery of only 1389 vehicles.

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