TCL denies rare earth investment reports
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Shares in TCL Corporation soared by 9.14 percent in the morning session on Monday after the company denied reports that it was planning to invest in the world's largest rare earth mine in Xinjiang Uygur Autonomous Region.
Guangdong-based TCL said the company had signed a framework agreement with Urumqi Economic & Technological Development Zone, to build an industrial park project in Xinjiang Uygur Autonomous Region for the production of components for LCD/LED televisions and other electronic devices.
There had been reports in the media last Thursday that Xinjiang TCL Energy Company was scheduled to cooperate with the local Xinjiang government, to exploit the rare earth mine in Baicheng county.
However, TCL denied the reports and said the company had never signed any agreements related to rare earth.
"Shares of TCL performed well before last week. It was said the company would invest in rare earth, which proved to be a rumor. The good performance is based on TCL's successful cooperation with Samsung Electronics Co," Li Hui, a home appliance analyst from Southwest Securities Company, told the Global Times.
"The home appliance industry has been revived, and not only TCL has performed well. Other home appliance companies like Hisense Electric and Changhong Electric have also done well recently," she added.
Shares in Shenzhen-listed TCL Corporation rose 0.40 yuan ($0.06) on Monday, finishing up 6.9 percent at 6.20 yuan ($0.95) per share.
Trading in TCL shares was suspended last Thursday and resumed on Monday. The company explained that this was because TCL had signed an original design manufacturer (ODM) agreement with Samsung Thursday, to supply designated liquid crystal display products, Li Dongsheng, president of TCL Corporation, told the 21st Century Economic Report.
"The rise in TCL's stock is only a short-term reaction to the cooperation between TCL and Samsung. The long term is more uncertain," Lu Renbo, director of the Consumer Electronic Product Survey Office from the China Electronic Chamber of Commerce, told the Global Times.
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