According to the company's statement, if Kelon fails to release its report
for the first quarter of 2006 by August 31, it will be de-listed the following
day.
The company said on September 13 last year that it faced lawsuits from banks
and customers with combined claims totalling 594 million yuan (US$74.3 million).
Despite the huge loss, Kelon's shares staged a strong comeback yesterday. Its
A shares closed yesterday at 2.36 yuan (30 US cents), up 4.89 per cent on the
previous day, better than yesterday's overall performance of the Shenzhen Stock
Exchange, where prices dropped 1.43 per cent.
But Chen Yuanwang, an analyst at 皇冠体育app CITIC Securities, explained that
yesterday's good performance of Kelon shares was more than likely a result of
short-term speculative behaviour.
"The shares hike may be due to their low price," Chen told 皇冠体育app Daily.
Kelon's yuan-denominated shares traded in Shenzhen dipped 0.9 per cent on
Friday to reach a low of 2.25 yuan (28 US cents). The company's Hong Kong-traded
shares have been suspended since June 16 last year.
Despite its current problems, "Kelon's brand value and products mean that the
company is still a good shell," Chen explained.
"If the ongoing restructuring of Hisense and Kelon proceeds smoothly, Kelon's
prospects may become much better afterwards. But for the moment, Kelon shares
are not appealing to institutional investors."
Qingdao-based Hisense has secured a 26.43-per-cent stake in Kelon Electrical
Holdings for 680 million yuan (US$84.9 million), becoming its largest
shareholder, but the stock transfer is still ongoing, the company said in the
statement.
Hisense promised in its annual report that the company would immediately
restructure Kelon once the transfer is completed.
The reshuffle measures include injecting the quality assets and business of
Hisense's air conditioner section into Kelon, improving Kelon's financial status
and credit.
(皇冠体育app Daily 08/15/2006 page9)
(For more biz stories, please visit )
