China BAK (CBAK) Crashes as Rumor Debunked

June 6, 2013 1:43 PM EDT
Shares of China BAK Battery (NASDAQ: CBAK) are giving back some of yesterday's 65% gains as rumors of a supply deal with Kandi prove false.

Rumors in the market Wednesday suggested that China BAK was supplying batteries for Kandi (Nasdaq: KNDI)/Geely Auto's co-developed electric sedan, which recently gained approval by Ministry of Industry and Information Technology of the People's Republic of China. The rumors, however, are dead wrong.

In an e-mail to blogger Richard Pearson Thursday, Kandi IR said "it doesn't have any relationship with China BAK Battery, Inc. (CBAK)."

Person sees the stock ultimately being de-listed and become worhless. "With the rumor now fully debunked, this stock will quickly find its way back towards zero. Even a cursory read of its business and financials demonstrates that there is no way for ChinaBak to recover," he said.

Shares of CBAK are down 14.8% mid-day to $1.21.

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