- China Securities Regulatory Commission probed Ganfeng Lithium Co Ltd (OTC: GNENY) for alleged insider trading for buying and selling a mainland-listed stock in the secondary market, the Financial Times reports.
- Ganfeng Lithium received a case filing from the regulator on July 1. Ganfeng Lithium did not expect the investigation to impact its "normal production and business activities," and it vowed to "actively co-operate" with investigators, FT noted.
- The probe comes as Ganfeng Lithium and other leading Chinese resource mining and processing groups solemnize state-backed efforts to consolidate China's dominance over the supply chain for electric vehicles and batteries.
- Ganfeng Lithium is a leading Chinese biggest lithium producer and a critical Tesla, Inc (NASDAQ: TSLA) and Bayerische Motoren Werke AG (OTC: BMWYY) supplier.
- Ganfeng Lithium battled volatility amid fluctuating lithium carbonate prices and China's pandemic lockdowns disrupting supply chains.
- The nationalization of the lithium industry also posed concerns over Ganfeng Lithium's assets in Mexico.
- Analysts expect the Sonora project in Mexico to account for about 5% - 8% of Ganfeng's total lithium output by 2025, remaining upbeat about the prospects of the Chinese electric vehicle industry.
- Analysts and investors saw immense growth potential as rival carmakers overhauled their business models to focus on electric cars, whose batteries rely on lithium.
- Recently, leading battery maker Contemporary Amperex Technology, miner Tianqi Lithium and Huayou Cobalt, another significant Chinese raw material supplier, moved to tap investors for over $10 billion in capital to expand operations.
- Price Action: TSLA shares traded lower by 1.73% at $669.98 in the premarket on the last check Tuesday.
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Read at Benzinga