China’s second-largest car dealer faces forced delisting as investors snub its shares

Name: ‘Overtaking on a bend’: how China’s EV industry charged ahead to dominate the global market
Uploaded: 2024-07-16T23:00:12.000Z
Duration: 12 min 53 s
Description: ‘Overtaking on a bend’: how China’s EV industry charged ahead to dominate the global market

China Grand Automotive Service is set to be expelled from the Shanghai Stock Exchange after its shares traded below their par value for 20 straight days

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Grand Automotive will become the second car dealer to be disqualified from the bourse in about a year, following the delisting of Pang Da Automobile Trade in June, 2023. Photo: SCMP Handout

Daniel Renin Shanghai

Published: 7:00am, 17 Jul 2024

China Grand Automotive Service, the mainland’s second-largest car dealer in terms of sales, is set to be expelled from the Shanghai Stock Exchange after its shares traded below their par value for 20 consecutive days, the latest sign of cracks appearing in the world’s largest vehicle market.

The Shanghai-based company plunged by the 10 per cent daily trading limit on Tuesday, ending at 0.87 yuan (12 US cents). It was the 19th trading session in a row that Grand Automotive saw its shares crash below the 1 yuan threshold.

Even if it were to jump by the daily trading cap of 10 per cent on Wednesday, it would not be able to break through the 1 yuan mark. According to exchange rules, a stock has to terminate trading and face delisting after its shares trade below the 1 yuan face value for 20 straight days.

“The company’s shares are being snubbed by investors, which reflects their bearish view about the business outlook for car dealers,” said Ding Haifeng, a consultant at Shanghai-based financial advisory firm Integrity. “Increasing electric vehicle (EV) adoption, new sales models and intensified competition make it extremely difficult for distributors of petrol cars to survive.”

Grand Automotive would become the second car dealer to be disqualified from the bourse in about a year, following the delisting of Pang Da Automobile Trade in June, 2023.

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‘Overtaking on a bend’: how China’s EV industry charged ahead to dominate the global market

Through more than 730 outlets across the country, it sells premium cars under brands such as BMW, Audi and Volvo.

China’s second-largest car dealer faces forced delisting as investors snub its shares

.css-1mniedq{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;}China Grand Automotive Service is set to be expelled from the Shanghai Stock Exchange after its shares traded below their par value for 20 straight days

China Grand Automotive Service is set to be expelled from the Shanghai Stock Exchange after its shares traded below their par value for 20 straight days