People’s Daily website becomes top stock pick as it ratchets up censorship to new level, fuelling revenue expectations
- People.cn shares have surged 325 per cent in 2019 as traders cash in on increasing government censorship
- ‘Content risk control’ becomes new growth engine for party mouthpiece
People.cn, the cheerleading website of the official newspaper of China’s Communist Party, suddenly has a new claim to fame: hot stock pick.
Investors have been piling into the stock, sensing the website of the People’s Daily has incredible profit potential at a time when president Xi Jinping has tightened his grip over news and commentary.
Shares of the Shanghai-listed website soared 10 per cent to 31.5 yuan (US$4.70) a few minutes after trading started on Tuesday. It was the 12th time in the past 15 trading days that the stock has hit the 10 per cent limit. (Chinese stocks are capped at a 10 per cent limit of either gains or losses.)
The website’s share price has rallied by 325 per cent since the start of the year, from about 7.4 yuan. That makes it one of the best performers on China’s A-share market.
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A key reason for the eye-popping gains is a thriving new business called “content risk control”, according to a research report issued by Dongxing Securities in late February. The report did not elaborate what exactly the business is.