Considering how bad our first experience with the VinFast VF8 was, it didn’t look like the most effective idea for VinFast to go public. Then again, nobody at Jalopnik is an investment expert, so perhaps someone smarter was giving higher advice we just couldn’t understand. Right out of the gate, it looked like we couldn’t possibly have been more flawed, with the stock price popping up to $82.35 a share. Today, VinFast’s stock isn’t even trading at $3 a share.
At its peak, the brand new electric automobile company was valued at greater than $85 billion, making it the fourth Most worthy automaker on this planet, behind only Tesla, Toyota and BYD. Except, unlike those three firms, VinFast barely sells any cars to actual customers. Vingroup founder Pham Nhat Vuong also retained control of greater than 99 percent of VinFast’s stock, leaving only 0.3 percent of total shares for others to trade.
So it’s not like there weren’t signs that VinFast was overvalued. Some investors likely knew that entering into and were betting they may make a fast buck by exiting before the crash. And in the event that they got lucky and sold on August 28 at the height, they probably did. The next day, the stock went into freefall, plunging to $46.25. By September 7, it was right down to $17.99 and has only continued to fall. A share of VinFast hasn’t been price greater than $10 for the reason that end of September, and despite recovering barely, earlier today it hit a record low of $2.57.
As you may imagine, a few of the individuals who thought they were making a legitimate investment are upset by this impossible-to-see-coming development. Earlier this month, two law firms announced a category motion lawsuit that claims VinFast “misrepresented and/or failed to disclose that: (i) VinFast lacked sufficient capital to execute its purported growth strategy; (ii) VinFast would be unable to meet its 2023 delivery targets; and (iii) accordingly, VinFast had overstated the strength of its business model and operational capabilities, as well as its post-Merger business and/or financial prospects.”
Speaking to the Charlotte News & Observer, VinFast’s spokesperson called the claims “baseless” and said, “VinFast has adhered to the highest ethical standards and has consistently complied with all laws and regulations in the markets where it operates. We will not comment further on this matter.”
Credit : jalopnik.com
