Han­ergy Thin Film sus­pends trad­ing af­ter stock plunges 47%


Han­ergy Thin Film Power Group Ltd, the Chi­nese so­lar equip­ment maker con­trolled by Li He­jun, suspended trad­ing in Hong Kong af­ter the stock plum­meted 47 per­cent in morn­ing trad­ing.

The stock fell to HK$3.91 be­fore the sus­pen­sion at 10:40 am, shav­ing HK$144.3 bil­lion ($18.6 bil­lion) off its mar­ket value, on the day of its an­nual gen­eral meet­ing in Hong Kong.

Be­foreWed­nes­day’s decline, the stock had surged more than six-fold in the past year de­spite ques­tions from an­a­lysts and in­vestors about the com­pany’s rev­enue sources. About 61 per­cent of Han­ergy Thin Film’s sales de­rive from Bei­jing-based par­ent Han­ergy Hold­ing Group, the listed com­pany said in­March.

The com­pany’s first state­ment on Wed­nes­day did not give a rea­son for the sus­pen­sion.

A sub­se­quent state­ment from Han­ergy said the stock has been suspended pending “an an­nounce­ment con­tain­ing in­side in­for­ma­tion”.

Han­ergy uses a niche tech­nol­ogy in the pho­to­voltaic in­dus­try, where more than three quar­ters of all pan­els are based on so­lar-grade sil­i­con.

Thin film cells are more flex­i­ble but less ef­fi­cient than crys­talline sil­i­con-based pan­els.

Prior to Wed­nes­day’s plunge, Han­ergy Thin Film’s mar­ket value had at one point risen to more than HK$300 bil­lion. That is larger than Ja­pan’s Sony Corp and al­most seven times the size of First So­lar Inc, the big­gest US so­lar com­pany.

The run-up in Han­ergy’s shares has not been with­out ques­tions.

“It’s an ad­just­ment that the mar­ket has been wait­ing to hap­pen, as Han­ergy’s earn­ings and busi­ness per­for­mance didn’t sup­port such a high stock price or val­u­a­tion,” said Gong Si­wen, Shang­hai-based an­a­lyst at North­east Se­cu­ri­ties Co.

The Chi­nese so­lar com­pany was the sub­ject in Jan­uary of an in­ves­ti­ga­tion by the Fi­nan­cial Times news­pa­per, which ques­tioned its “un­con­ven­tional” ac­count­ing prac­tices.

A Feb 27 re­port from an­a­lysts Charles Yonts and Johnny Lau at CLSA Asia-Pa­cific Mar­kets in Hong Kong raised more skep­ti­cism, say­ing the stock was wildly in­flated.

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