Shares of Chow Tai Fook Jewellery, the largest jewellery retailer in China, fell nearly 10 per cent yesterday as investors' worries about slower growth in the sector escalated. The stock declined 9.6 per cent to close at HK$10.54, the lowest since its debut last December, after media reported the company had cancelled the bonus for back-office staff. Apple Daily reported yesterday that the Hong Kong-based jewellery and watch seller announced in an internal meeting last Thursday it would scrap the guaranteed bonus for back-office staff, equivalent to three months' salary. The paper said the company would also cancel the back-office employees' monthly bonus, although it would raise their basic salary. Apple Daily said the change might reduce the affected employees' income by up to 50 per cent. A person close to the company said the adjustments in the compensation scheme were aimed at improving the stability of employees' income and building a fairer system. Average annual compensation would remain about the same, and only a small number of employees would be affected negatively, he said. The company did not comment on the report. 'We do believe the company is looking at costs carefully, as the market has slowed down to 10-12 per cent growth in March to April,' said Aaron Fischer, head of consumer and gaming research with CLSA, citing official data for mainland jewellery sales. The shares of several other jewellery retailers also declined yesterday. Luk Fook fell 3.9 per cent to HK$17.40, Tse Sui Luen Jewellery fell 5.7 per cent and Chow Sang Sang fell 4.3 per cent. Chow Tai Fook's stock price has plunged 23 per cent since the beginning of the year. 'The recent slowdown in the market could result in heavier promotional activity, which could affect margins,' Fischer said. Chow Tai Fook aims to increase the number of its shops to 2,000 by 2016 from about 1,300 today. Eugene Mak, of Core PacificYamaichi Securities, said: 'Chow Tai Fook is the most aggressive player in terms of expansion. It's apparent that the retailer is facing mounting cost pressure now.'