Investing.com -- Shares in Evergrande (HK:3333) shed more than a fifth of their value on Monday after the embattled Chinese property developer announced that it would be unable to issue new debt.
Evergrande 's stock slumped by 21.8%, its largest one-day percentage decline since late last month, while the Hang Seng Mainland Properties Index slid by 4.2%.
In a stock exchange filing in Hong Kong on Sunday, the company said it does not currently meet the "qualifications for the issuance of new notes" because one of its major subsidaries, Hengda Real Estate, is currently being investigated.
Hengda said in August that it was the subject of a probe by China's securities regulator over a suspected violation of disclosure rules.
The announcement marked yet another setback for Evergrande, the world's most indebted developer who has been at the center of a property sector crisis hitting the Chinese economy. The company has been attempting to secure creditor approval to restructure its debt, proposing options like swapping debt holdings into new notes with maturities of 10 to 12 years.