Aug 04, 2021 09:37 AM

CX Daily: State Media Commentary That Sunk Gaming Shares Removed, Then Restored With Less Gusto

The price of Tencent Holdings Ltd.’s Hong Kong-listed shares fell by as much as 10.8% Tuesday. Photo: VCG
The price of Tencent Holdings Ltd.’s Hong Kong-listed shares fell by as much as 10.8% Tuesday. Photo: VCG

Gaming /

State media commentary that sunk gaming shares removed, then restored with less gusto

Shares in Chinese gaming firms plunged Tuesday after a state newspaper published an article criticizing what it called the “spiritual opium” of gaming addiction, before clawing back some of their losses after the article temporarily vanished from the web.

The price of Tencent Holdings Ltd.’s Hong Kong-listed shares fell by as much as 10.8%, its biggest drop in a decade, before recovering slightly in the afternoon to close down 7.07% at HK$441.40 ($56.76).

Elsewhere on the bourse, NetEase Inc. plummeted by 15.7% before ending the day down 8.47% at HK$144.80, while Bilibili Inc. declined 14.3% before finishing down 4.19% at HK$640.50.



Crops destroyed by flooding in Jiaozuo, Central China’s Henan province, Friday. Photo: VCG

Insurers /

Henan floods to cost insurers billions

The deadly floods that devastated swathes of Central China’s Henan province last month are expected to cost insurers billions of yuan, sounding a warning for the costs of climate change, according to industry insiders and analysts.

The official death toll (link in Chinese) reached 302 Monday, and estimates of immediate economic losses passed 114 billion yuan ($17.6 billion). The provincial capital, Zhengzhou, was the hardest hit by far, while flooding and heavy rain also severely affected other cities, including Xinxiang, Hebi and Kaifeng.

Insurance payouts related to the disaster are expected to exceed 8 billion yuan, or about 0.7% of China’s total non-life direct premiums in 2020, analysts at global ratings giant Fitch Ratings Inc. wrote in a report. An actuary at a large property insurance company projected more than 10 billion yuan.

Beijing vows to punish any misconduct in response to deadly flooding in Central China

Banking /

Credit of Shengjing Bank and seven others downgraded

The credit ratings of eight small and medium-size Chinese banks were downgraded as nonperforming loans rose, according to China Lianhe Credit Rating Co. Ltd.

One of the downgraded banks is Shengjing Bank Co. Ltd., a lender associated with debt-plagued developer China Evergrande Group. Lianhe Credit lowered its rating of Shenyang-based Shengjing Bank to AA+ from AAA, citing an increase in nonperforming loans and decreased quality of credit assets amid the ongoing Covid-19 pandemic and accelerated exposure to regional credit risks.

Huarong /

Huarong to restructure, exit units in downsizing push

China Huarong Asset Management Co., the country’s bad-debt manager which roiled markets with doubts about its future, will exit one unit and restructure another to focus on its core businesses as it seeks to shore up its finances.

Huarong plans a public transfer of its 70% equity in Huarong Consumer Finance to external parties, it said Monday in a Hong Kong stock exchange filing. The state-owned company also intends to negotiate with the main institutional creditors of Huarong Trust’s outstanding debt to complete a “debt-to-equity swap and equity transfer,” it said.

Covid-19 /

Devastated by flooding, Central China province now faces Covid outbreak

Flood-stricken Henan province in Central China is battling a Covid-19 outbreak that began with a case imported from Myanmar, with the number of local infections rising to 78 within four days.

Provincial capital Zhengzhou reported 75 locally transmitted cases as of Monday. The city recently suffered devastating flooding that left nearly 300 people dead.

Quick hits /

Caixin New Economy Index inches higher as capital investment grows

China traders add to easing bets as economic prospects dim

Wang Tao: What’s behind China’s regulatory headwinds?



A New Oriental school in Shanghai Aug. 22, 2018. Photo: VCG

Education /

Chinese tutoring firms cancel earnings releases amid regulatory crackdown

Two of China’s largest U.S.-listed private tutoring businesses canceled the release of their earnings reports after Beijing radically altered the landscape with new regulations that will ban many in the sector from making a profit.

New Oriental Education & Technology Group Inc., the Asian nation’s biggest private tuition provider, and TAL Education Group both said Friday that they canceled the disclosures and calls with investors “in light of the recent regulatory developments.”

Neither company provided specific reasons for the move. New Oriental previously said it would release its report for the fourth quarter of last year Tuesday in the U.S., while TAL said it would disclose its results for the first quarter of its fiscal year, which starts in March, on Thursday.

Coal /

Yongcheng Coal and executives fined $820,000 for fraud

Yongcheng Coal and Electricity Holding Group Co. Ltd. and its executives were fined 5.3 million yuan ($820,000) for financial fraud after the coal producer’s high-profile default last year rattled the bond market and shook investors’ confidence in state-owned companies.

Yongcheng Coal received an administrative penalty from the China Securities Regulatory Commission (CSRC) July 27 over disclosure violations including inflating funds in its financial statements by 86.1 billion yuan ($13.3 billion).

Batteries /

China’s Shanshan to invest $1.2 billion in lithium battery project

Chinese battery-materials maker Ningbo Shanshan Co. Ltd. said it is planning to invest 8 billion yuan ($1.2 billion) in a new project in Southwest China’s Sichuan province to boost its current insufficient production capacity and satisfy growing demand.

The project, which will be set up by subsidiary Shanghai Shanshan Lithium Battery Material Technology Co. Ltd., will involve the construction of a facility capable of producing up to 200,000 tons of lithium-ion battery anode materials a year in the city of Meishan, according to a filing (link in Chinese) to the Shanghai Stock Exchange Monday.

Quick hits /

Lenovo retains PC sales crown with 25% of the market

Electric-car maker Li Auto seeks $1.9 billion in Hong Kong listing

No retail company climbed the Fortune Global 500 faster than Xiaomi this year

Energy Insider /

China’s steelmakers report 220% first-half profit growth



A village ravaged by heavy rain in Henan

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