Tencent shares lowest in 15 months, having shed US$220 billion since January
Drop in value more than the entire market cap of Intel, and twice that of Nike
Shares in Tencent Holdings, China’s largest social media and games company, continued their downward spiral on Monday, closing below HK$300 for the first time since July 2017. They ended down 2 per cent at HK$299.00, a seventh straight day of decline.
The stock has now lost HK$1.7 trillion (US$220 billion) in market value since January 29, when it reached an all-time intra-day high of HK$476.60. That is more than the entire market cap of Intel, and twice that of Nike.
“This [today’s drop] is not just about Tencent itself, but also reflects weak investor confidence towards the Hong Kong and China market,” said Norman Hui, a Hong Kong-based analyst with Zhongtai International Securities.
He said the stock may continue its downward trajectory short-term, as the overall market remains weak and Tencent’s core gaming business is still suffering from a regulatory crackdown. He predicted the stock could hit a low range of HK$270 to HK$280 in the short term.
Its recovery, he added, now depends on the company growing its cloud revenue and resuming the launch of new games, which came to a stop earlier this year due to the regulatory hiatus.
