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KNDI Stock: The EV News Sending Kandi Technologies Revving Up Today

Chinese electric vehicle manufacturer Kandi Technologies (NASDAQ:KNDI) is rebounding today on news that the company will produce EVs that are capable of doing battery swaps.

The EX6 model from Kandi Technologies (KNDI) is on display in Shanghai.

Source: Carrie Fereday /

KNDI stock is up 2.5% today to $3.41 a share on this news. The increase in the share price is welcome for Kandi Technologies. This is especially true after its stock suffered a 42% decline over the past six months, including a 8% drop in the last month. Much of the pain stems from a negative report from Hindenburg Research in 2020.

What Happened With KNDI Stock

In a news release, Kandi Technologies announced that it has signed a framework agreement with Hunan Hengrun Automobile to produce battery-swap enabled electric vehicles together for the Chinese market. Investors may be familiar with battery swapping thanks to Nio (NYSE:NIO). This tech, also known as battery as a service, is quite popular in China.

In Nio’s model, EV owners in China pay a yearly subscription fee to have the battery in their electric car, truck or SUV swapped for a fully charged one when needed. The service is similar to the way consumers swap empty barbecue propane tanks for full ones at gas stations.

The battery swap model alleviates the need for vehicle owners to invest in expensive infrastructure to charge their electric vehicle battery at home. Nio has reported success with its battery swap business, having recently announced that it opened its 700th battery swap station. Nio’s stations have swapped a total of 5.3 million batteries in and out of its various electric vehicles.

Why It Matters

The battery swap initiative is positive news for Kandi Technologies and is helping KNDI stock recover. Since November 2020, its share price has been under pressure thanks to a negative report by notorious short seller Hindenburg Research, which alleged that the company is employing fake sales numbers to lure U.S. investors.

In its critical report, Hindenburg accused Kandi Technologies of falsifying “revenue using fake sales to undisclosed affiliates.” Hindenburg also noted that one of Kandi’s “largest customers” has the same phone number as a Kandi subsidiary and is run by an executive of Kandi. The negative assessment from Hindenburg Research sent investors rushing to sell KNDI stock.

What’s Next for Kandi Technologies

News of the battery swap deal looks to be giving KNDI stock a small reprieve today as the share price reverses from its descent in recent months. However, today’s move higher is small and the slump in Kandi Technologies stock could continue if investors remain skeptical of its legitimacy. Chinese stocks, including those of electric vehicle makers, have fallen over the last year as government authorities and regulators have sought to reign in publicly traded companies. NIO stock is down 51% in the last 12-months. Investors should proceed with caution.

On the date of publication, Joel Baglole did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines.

Article printed from InvestorPlace Media,

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