When the news of the ice core production suspension was further confirmed, following Russell, the pioneer of short selling, many Wall Street financial giants finally showed their interest in Yike.
It seems that this legendary company from the East has fallen into unprecedented weakness.
so……
Chanos, known as the "Short Master" on Wall Street, appeared on a program discussing Yike's situation, claiming that "financial reports are the most important criterion for measuring a company's stock price" and believed that "Yike's current stock price is still overvalued."
Said "Knicks United Fund has joined the ranks of shorting Yike".
Chanos is the president and co-founder of the Knicks United Fund. He once openly questioned the financial fraud of Enron, which ranked seventh among the Fortune 500, and successfully shorted it to make a profit.
The reason why he has not shorted Yike for the first time recently is that he is observing the situation of this famous "short killer" company, and secondly, he is shorting another well-known Chinese company Alibaba.
Although Yike's stock price has fallen a lot, Chanos has always believed that it is better not to obtain the maximum profit, but to pursue the right profit.
Now is the "right" moment for Yike. The company's decline is inevitable, and its broken points are quite clear.
However, due to complex factors such as Yike's local market, the founder's successful image, and many transactions with affiliated companies, its stock price can remain relatively strong.
Chanos believes that this relative firmness is unhealthy and will inevitably break.
Also, due to the relevant regulations of Nasdaq, Yike's Q3 financial report had to be released before October 31, which means that the time of its collapse was at that time.
Yike's third quarter is bound to be very poor, which will inevitably be the last straw of downward pressure on the stock price.
As for whether Yike will recover or continue to sink after this, it has nothing to do with the short sellers, because the profits that should be captured have already entered their pockets, and the institutions have successfully retreated long ago.
"Short Master" Chanos's voice and emphasis on the importance of Yike's Q3 financial report made Russell and others overjoyed, and they all hoped that more forces would work together to suppress Yike's stock price.
It seemed that there was an agreement or a tacit understanding, or that they had seen Yi Ke's irreversible weakness. Even Russell was surprised by the fact that people in the industry stood up.
Einhorn, the founder of Greenlight Capital who once shorted Lehman, commented on Yike's current situation and believed that "an elephant cannot dance if it loses its limbs" and made it clear that he was involved in short selling Yike.
Ackman, the founder of Pershing Square, became famous for his short-selling battle with MBIA, an American city bond insurance company. He has been fighting with Herbalife in recent years, and now he has joined the short-selling camp of Yike and elaborated on his views——
"Mr. Fang is respectable, but Yike has encountered serious problems on both the supply and demand sides. No one should miss this opportunity."
Steve Cohen, the hedge fund tycoon known as "Jordan", spoke on Twitter. On the one hand, he recognized the views of his peers, and on the other hand, he also mentioned a little incident in the past.
"The company Yike should have been destroyed long ago. Its current scale is the product of power-money bargaining! Its performance in the secondary market back then was the result of shameful non-commercial factors!"
"Yike has ended up like this because of non-commercial factors. I can only say that it deserves it!"
"Fang Zhuo has swallowed my money. This time he will spit it out all to me!"
In fact, Steve Cohen's name did not appear on the list of people who were shorted by Yike a few years ago, but since he was so indignant and forbearing, he must have secretly participated in the short selling of Yike.
In addition to these big names who have spoken out publicly, there are also industry giants who directly called Fang Zhuo on media programs to inform them of short selling Yike.
Ken Griffin founded Citadel in 1990 and later made it one of the most successful hedge funds in the world. In 2007, it went public on the New York Stock Exchange and became the first in the United States.
A hedge fund management company that conducted an IPO, and he himself became one of the top 100 richest people in the United States.
As of the latest information disclosed in 2016, Citadel's net assets under management were US$34.7 billion, regulatory assets reported to the SEC were US$242.9 billion, and leverage reached 7 times.
It can be said that although everyone else is already a big boss, Griffin is still the one who can best be called a predator who has made outstanding moves in recent times. Moreover, he also has Fang Zhuo's private number.
"Yike's success is undoubtedly incredible and extremely dazzling, but what I want to say is that no company can avoid setbacks."
"To this day, I still think Mr. Fang has extremely excellent leadership skills and is one of the best business leaders in the world."
"However, we must also admit that a person and an enterprise will always have boundary categories."
"I think Yike should not be restricted by the current political factors, but it has already happened, and we cannot ignore the existence of this situation, so Castle chose to join."
Griffin explained Citadel's reasons on the TV show. Of course, he did not mention that Citadel had taken both sides in the "market maker" business during the last Yike incident, and subsequently suffered losses as a result.
He then continued to talk about the other person's personal appreciation and dialed the private number in the address book.
Since Yike was restricted, Fang Zhuo has rarely appeared or spoken out in public. This scene undoubtedly made the TV station and the viewers watching the program extremely excited.
The call to the private number went through.
Griffin and Fang Zhuo knew each other, but he was the head of Yike who was introduced to him by a friend in Washington. They were not particularly familiar with each other and were just acquaintances.
When he called, there was no unnecessary explanation in the first sentence. He just said in a relaxed tone: "Hi, Mr. Fang, I have joined them. Citadel really cannot stop talking about business."
There was no immediate response from the other end of the phone, but after a period of silence that made everyone's thoughts wander, Fang Zhuo's calm voice came over.
"Gotcha, I see ya."
With this sentence, the phone was hung up.
This is a slang expression - OK, I get it.
But in addition to "gotcha", it also means "got you", and "I see ya" means "I see you", which means I see you/I noticed you/take care/goodbye.
--Okay, I know.
——I caught you, take care.
When I heard Fang Zhuo's voice at the show, I let out a "oh ho" sound. It was a pity that this person could not talk more.
However, as Griffin held the phone, Mr. Fang's calm voice seemed to be still echoing in his ears, and he suddenly felt a little shuddering in his heart. Was it this "gotcha" or that "gotcha" on the other side?
He managed his emotions, put away his cell phone, and completed the final part of the program.
Later, Griffin once again asked the company to review the relevant information of Yike and Bingxin one by one to confirm whether there was any unexpected situation this time, but the final conclusion did not overturn the previous decision.
Knicks United Fund, Greenlight Capital, Pershing Square, Point72, Castle Investment...
When these world-famous hedge funds revealed themselves, when giants such as Chanos, Einhorn, Ackman, Griffin, and Steve Cohen made their attitudes clear, their real money investments quickly arose.
Effect.
Yike's market value was further depressed to a new low of US$240 billion. At the same time, the short positions announced by Nasdaq also rebounded quickly after "The Wolf Comes Again", setting a new record and reaching a high of US$18.6 billion.
In just half a month, Yike not only became the number one in the world, but also separated itself from Alibaba, surpassing the second place with US$6.1 billion to consolidate its position.
On the first day of September, Yike still held on to the US$240 billion line, but Alibaba's market value had risen to US$244.9 billion, officially achieving the company's overtaking in market value.
This trend also caused quite a shock.
September is the last month of the third quarter, but Yike mobile phone products were almost completely exhausted in late August, proving the serious impact of the suspension of ice core production.
Although Bingxin must have been operating at full capacity to leave chip inventory for Yike, Yike is facing demand from two huge markets in Europe and China. Even if it manages shipments, it will not help.
The financial market has suffered the largest short selling in history, the mobile phone market is facing intensifying competition due to shortages, and the company's stock price and market value have been surpassed by local rivals...
Even the domestic media felt a lot of pressure when looking at this situation.
Taking into account the significance of Yike and Bingxin, the mainland's reports were more tactful and expressed little confidence, but the Xiangjiang side was much more straightforward in explaining the current predicament of the Yike Department.
"Yike may suffer a violent and sudden death."
"The Q3 financial report on October 31 will most likely determine the sharp fluctuations in Yike's stock price."
"Although we hope it will be a positive, positive signal, facts from all aspects are constantly releasing similar conclusions. Yike's third quarter performance was very poor."
"It is undoubtedly too much to ask Yike to maintain good performance under multiple burdens and complex geopolitical interference, but the prediction of a sharp decline is also a deliberate pressure exerted by some institutions to grab profits."
"Yike has an opportunity. Once its potential in China is fully realized, it will be enough to support the current market value and stock price."
"Sadly, markets tend to succumb to the instigation of certain institutions."
"Yike may be seriously injured, but I believe he will gradually recover. I wish him and Mr. Fang good luck."
The tone of the Xiangjiang "Economic Herald" is very regrettable. Yike seems to have become a situation where many people have been killed, and it is beyond human power to restore it.
Coincidentally, on September 3, news from Taiwanese journalists once again added a bad news to the Yike Department.
——Taiji has completed the risk trial production of the 10nm process and is expected to put it into production by the end of the year and achieve small-scale mass production in the first quarter of next year.
No matter what situation Yike and Bingxin encounter, the development of the industry will inevitably continue to move forward.
Yike has not yet held an autumn conference. Although its out-of-stock Mars 9 is still competitive this year, next year will be the year of 10nm. Ice Core’s 16nm has no production capacity, let alone a more advanced process.
From November last year to September this year, Yike's market capitalization peaked at US$420 billion. At its lowest, it fell to US$240 billion due to the news about Taiwan's technology, reaching a new record low of US$236.8 billion, a drop of as much as 43.6%.
Russell, the pioneer of RC Fund, posted a video of opening champagne on the emerging TikTok short video platform and gave his final evaluation.
"No, why should we wait for a spectacular death? Isn't the stock price cut in half spectacular enough?"
"Yike is dead. Now he just needs a formal funeral."
"Interestingly, the tombstone for this funeral needs to be filled in by Yike himself using the Q3 financial report."
"Hoho, come on!!"
On September 15, Yike’s short position has exceeded an unprecedented US$20 billion, setting a global record again. There is only half a month left before the end of the third quarter, and the financial report will be released in only one and a half months.
The mainland media has remained unusually quiet, seemingly silently waiting or witnessing the possible last straw for Yike predicted by foreign media.
On September 17, Fang Zhuo, who was in Xi'an, suddenly received a call from Bingxin. He immediately ignored the local meeting he was going to attend the next day and boarded a passenger plane flying to Luzhou.
