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Shares in Chinese property developer Fullshare Holdings jumped on Thursday after the company batted back allegations over its valuation in a report written by short-seller Glaucus Research.
Fullshare had been in a trading halt since April 25 when Glaucus issued a report questioning the company’s share price trading patterns, its valuation and asset disposals. The California-based short-seller has also responded quickly, giving short shrift to Fullshare’s response.
The Hong Kong-listed developer, which is in the midst of refocusing its business on renewable energy and healthcare, said in a statement to the Hong Kong Stock Exchange on Wednesday that it “denies all of the allegations” put forward by Glaucus in the report.
Fullshare said the report “comprises statements which are misleading, biased, selective, inaccurate and incomplete as well as groundless allegations and irresponsible speculations”, adding Glaucus does not understand the disclosure requirements and listing rules under Hong Kong financial reporting standards.
Glaucus was unmoved, and today labelled Fullshare’s response as “totally inadequate” and failing to present any meaningful rebuttal to questions about the stock’s trading patterns. The short seller said it was sticking with its valuation of HK$0.55 per share and said it was “reasonable to expect further downside pressure” on Fullshare’s stock price.
Fullshare’s stock rose as much as 15.1 per cent to HK$2.90 on Thursday when trading resumed. Shares fell 11.9 per cent when Glaucus published its report and before the company entered a trading halt on April 25.