Chaori shares fall by daily trading limit
Print Edition
SHARES of troubled Chinese solar company Shanghai Chaori fell by their daily limit yesterday after they resumed trading for the first time since the firm’s bond default.
The tumble also came after a bondholder sought bankruptcy restructuring for the Shanghai-based solar-cell maker.
Shanghai Chaori Solar Energy Science & Technology Co slumped 5 percent to 2.46 yuan (40 US cents) on the Shenzhen Stock Exchange yesterday. Its shares had been suspended since February 19.
The firm, which had posted two consecutive years of net losses in 2011 and 2012, was placed by the Shenzhen bourse in the “special treatment” category last year which limits the daily trading movement of shares to 5 percent instead of the regular 10 percent.
Chaori became the first Chinese firm to default on its onshore corporate bonds when the company failed to make a full interest payment due on March 7.
The default prompted its creditor, Shanghai Yihua Metal Materials Ltd, to file a petition with the Shanghai No. 1 Intermediate People’s Court to put Chaori into bankruptcy restructuring, Chaori said last week.
Chinese solar panel makers have suffered from overcapacity and falling product prices after rapid expansion over the past years. Still, Chaori’s default has highlighted risks in China’s debt capital market.
Last Friday, securities regulators acknowledged the second corporate bond default after Xuzhou Zhongsen Tonghao New Board Co, a small construction materials company, missed an interest payment.
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