SINGAPORE: Chinese electric vehicle manufacturer Nio Inc saw its shares rebound on Friday following sharp declines triggered by a lawsuit from Singapore’s sovereign wealth fund GIC.
The lawsuit filed in New York’s Southern District accuses Nio of issuing misleading statements that artificially inflated its securities value.
GIC claims these alleged actions caused the fund to suffer significant financial losses.
Nio’s stock rose 2.86% in Singapore and 2.48% in Hong Kong during Friday afternoon trading.
This recovery followed Thursday’s steep declines of 9.8% in Singapore and 13% in Hong Kong after media reports revealed the August-filed lawsuit.
The legal action could potentially impact Nio’s future fundraising efforts according to market observers.
Nio has firmly denied all allegations linking them to false claims from a 2022 Grizzly Research short-selling report.
The company did not immediately respond to AFP’s request for additional comments.
Nio recently secured 1.2 billion dollars through a share sale last month while trailing Chinese competitors BYD and Geely.
The electric vehicle designer and manufacturer went public in the United States in 2018 with additional listings in Hong Kong and Singapore.
Morningstar Research noted the allegations could damage Nio’s corporate governance reputation without materially affecting operations.
The research firm expects vehicle sales growth and profitability improvements to support near-term share prices. – AFP
