Techtronic slumps most since 2008 after short-seller’s report

Bloomberg

Techtronic Industries Co. slumped by the most since November 2008 after short-seller Jehoshaphat Research questioned the accounting methods of the Hong Kong power-tool maker.
Shares of Techtronic fell as much as 19% before trading was halted in Hong Kong. The company has been “inflating its profits dramatically for over a decade with manipulative accounting,” Jehoshaphat alleged in a report dated on Wednesday. The short-seller sees “60-80% downside” for the stock.
A spokesperson at the Techtronic, which had a market value of about $17 billion after Thursday’s decline, did not immediately respond to Bloomberg’s request for comment. Short interest accounted for about 3.8% of Techtronic’s free float, up from less than 1% in July, according to IHS Markit data.

The move on Techtronic comes amid heightened attention on short-seller campaigns in Asia in the wake of allegations from Hindenburg Research that have erased more than $140 billion in market value from India’s Adani Group. Chinese companies targeted by short-sellers recently include electric-car maker Nio Inc. and retailer Miniso Group Holding Ltd.
Anonymously operated Jehoshaphat specializes in “forensic research on companies that are publicly traded,” according to its website, which shows reports dating back about two years. The little-known firm, which lists no address or phone number, has so far written reports mainly on US-listed companies.