* CTEG’s shares plummet nearly 13 pct in afternoon trade
* Glaucus says volume of water treated at facilities inflated
* Estimates CTEG’s revenues at least 30 pct less than reported
* CTEG not immediately available for comment (Adds details)
HONG KONG, Nov 23 (Reuters) - Trading in shares of CT Environmental Group (CTEG), which engages in industrial wastewater treatment and hazardous waste disposal, was suspended on Wednesday, after its shares slid following a short-seller report.
Short-seller Glaucus Research Group issued a report after the midday trading session in Hong Kong criticising the company’s accounting practices, sending its shares plunging nearly 13 percent.
CT Environmental, which has a market value of HK$13.5 billion ($1.74 billion), could not be immediately reached for comment.
The report was the latest from an independent researcher questioning corporate practices at a Chinese company.
In its report, Glaucus said that based on wastewater data from the Chinese government, CTEG had lied about the volume of water treated at its facilities and, as a result, its reported revenues and profitability.
Glaucus estimated that CTEG overstated the amount of wastewater processed at a Guangzhou treatment facility by more than 82 percent from 2012-2014.
California-based Glaucus estimated CTEG’s revenues were at least 30 percent less than reported and valued its shares at HK$0.38, an 82 percent decline from Tuesday’s closing price.
Shares of the company slid 12.6 percent on Wednesday afternoon before they were suspended, lagging a flat broader market.
“Given that CTEG’s debt levels have ballooned to 2.3 billion yuan in 1H 2016, we believe that it is reasonable to expect even further downside pressure on the company’s shares,” Glaucus said in its report.
$1 = 7.7550 Hong Kong dollars Reporting by Anne Marie Roantree and Jess Macy Yu; Editing by Jacqueline Wong
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