Delisting Slams Chinese Auto Parts Player (TXIC, SORL, CYD, CAAS)
Tongxin International (TXIC) slid by -24% on Tuesday after Nasdaq denied the company’s request for continued listing. The firm failed to produce regulatory filings, specifically Form 20-F, which are required for listing on the exchange. The firm had contested that its failure to produce the form was the result of an ongoing investigation by its audit committee, but after Nasdaq’s denial of the continued listing request, Tongxin will be delisted on the exchange and suspended on the opening of October 14. Once Form 20-F is filed, the firm plans to re-apply for Nasdaq listing.
As a whole, the Chinese Auto Parts Stocks Index is down by -2% today, but it is still outperforming the S&P 500 by 3% over the last month. Tongxin and SORL Auto Parts (SORL) are the only losers for the period, as China Yuchai International (CYD) and China Automotive Systems (CAAS) post double-digit gains.
China’s automotive segment has been an area of focus after it passed the U.S. market in size for the first time in 2009. Auto parts firms have become highly tradable amid substantial volatility in 2010, and with four of five Chinese Auto Parts Stocks Index components -30% or more from their respective 52-week highs, it will be interesting to see how the stocks perform in the fourth quarter.
Investors can track the Chinese Auto Parts Stocks Index for performance trends and a suite of other metrics at tickerspy.com.
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