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West China Cement Ltd plunged the most in two years in Hong Kong trading after the short-seller Glaucus Research Group questioned the company's corporate governance and financial statements. The company denied the accusations.
The cement maker dropped as much as 16 percent, headed for the biggest percentage decline since it started trading in Hong Kong in 2010.
The Xi'an-based company is the latest in the country to have its accounting and corporate governance standards questioned by short sellers, who seek to profit from declines in share prices. Sino-Forest Corp sought bankruptcy protection in Canada in March after Carson Block's Muddy Waters LLC said it overstated assets.
Glaucus's report on West China Cement contains "certain allegations or comments on the company, which are groundless or misstatements," the company said in a statement to the Hong Kong Stock Exchange on Thursday.
China Daily-Agencies
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