By Clare Jim

HONG KONG (Reuters) -Shares of China Evergrande New Energy Vehicle Group (NEV) plunged on Friday as trading resumed nearly 16 months after the stock was suspended pending the release of financial results.

Resumption of trading in the shares is one step forward for its embattled parent China Evergrande Group, whose offshore debt restructuring plan includes swapping part of the debt into equity-linked instruments backed by the group, Evergrande NEV and another unit, Evergrande Property Services.

Shares of Evergrande Group, laden with $330 billion in total liabilities, and its services arm have remained suspended since March 2022.

Shares of Evergrande NEV sank as much as 69% to HK$1 in early trading, down from HK$3.2 on its last closing date of April 1, 2022.

That compares to a 19% rise in Chinese EV giant BYD Co and 27% drop in EV startup Xpeng Inc during the 16-month period.

Evergrande NEV reported on Wednesday a combined net loss of 71.12 billion yuan ($9.95 billion) for 2021 and 2022, while its auditor Prism Hong Kong and Shanghai Limited said it did not express an opinion on the financial reports because there were material uncertainties relating to going concern.

The company, which has been under pressure since its parent entered a debt crisis in mid-2021, had previously warned it might have to wind up operations unless it obtained new funding.

In 2022, the firm had to delay mass production of its first flagship model, Hengchi 5. The firm said in June that as of May, it had delivered more than 1,000 units of the EV, whose sales started in October last year.

In a filing on Thursday, the firm said it has fulfilled all the requirements laid out by the stock exchange to resume trading, including demonstrating that it had a viable and sustainable business with a sufficient level of operations and assets.

It said its next target will include rolling out the Hengchi 6 and Hengchi 7, and it plans to raise $500 million through equity and debt financing for satisfying the capital requirements for production and sales of Hengchi 5 and its normal operations.

It added it has been in discussions with potential investors and it is confident that it would be able to raise sufficient funds.

Currently, the utilization rate of the production capacity of its Tianjin manufacturing base is affected by capital constraints and there are cases of late payment of employees’ salaries, the filing said.

(Reporting by Clare Jim; Editing by Jacqueline, Jamie Freed and Kim Coghill)