(Yicai Global) Feb. 14 -- Shares of Contemporary Amperex Technology rose after the Chinese battery giant rebutted “malicious” rumors that it faces new US sanctions and that price negotiations with Tesla have failed.

CATL [SHE: 300750] closed 3.7 percent up at CNY508 (USD79.86) today, pulling back from an earlier 4.7 percent gain. The stock sank more than 19 percent last week amid the internet rumors, shaving CNY239 billion (USD37.6 billion) from the Shenzhen-based company’s market value.

The rumors alleged that CATL is facing new US sanctions, will be dropped from the ChiNext weighted stock index, and its battery price talks with Tesla have fallen through, with BYD, another Chinese battery giant, taking its place. Rumor also had it that Xpeng Motors would replace the products supplied by CATL with those made by China Aviation Lithium Battery.

In a statement released yesterday, CATL said the “malicious” rumors were untrue and that it reported the matter to the police on Feb. 12 and it will take legal action against the “rumor-mongers.” A Tesla official also denied that the talks had collapsed, Shanghai Securities reported yesterday.

Apart from Tesla, CATL’s other major clients include Nio, Xpeng, SAIC Motor, and FAW Group. Orders from the US electric carmaker accounted for 20 percent of last year’s total.

Brokerages have diverging views on CATL’s future. According to Capital Securities’ latest research report, the company may see its earnings plunge 20 percent due to strong competition. But UBS Group believes that CATL will beat expectations, with earnings likely to have grown 30 percent to 40 percent last year.

CATL expects net profit to have risen 151 percent to 196 percent in 2021 to between CNY14 billion and CNY16.5 billion (USD2.2 billion and USD2.6 billion).

Editor: Futura Costaglione