Almost 100 listed companies in mainland China have been affected by Covid-19 lockdown measures in Shanghai and elsewhere, undermining the corporate earnings outlook on top of other economic headwinds for investors in the world’s second-biggest stock market. The 98 companies on the Shanghai and Shenzhen exchanges probably saw a slowdown in earnings growth last quarter, because of production halts or supply-chain disruptions, according to analysts at Zheshang Securities based on stock-exchange disclosures. The affected industries include everything from construction and clothing to food and household appliances, they added. Most of the companies are smaller enterprises, showing their vulnerability to the nation’s uncompromising pandemic-control measures. Coronavirus: Shanghai factories amble towards reopening as city’s standstill order nears its end amid declining daily Covid-19 cases “The first-quarter results should be okay as the full impact of the Shanghai lockdown won’t be felt yet,” said Wang Zheng, chief investment officer at Jingxi Investment Management in Shanghai. “The second-quarter number will be uglier and we will need to brace for that.” The Shanghai Composite Index has fallen 12 per cent this year, making it the worst performer among major indices in the Asia-Pacific region. At least 20 provinces or municipalities have been placed under lockdown this year. Goldman Sachs said cities with high- and mid-risk districts accounted for a third of China’s economic output in the last two weeks of March. Only 11 of the companies in the CSI 300 Index have released first-quarter results so far, and their earnings beat estimates by 46 per cent, according to Bloomberg data. Pain for China stock funds, with strategists at Goldman, Credit Suisse confounded by PBOC’s token easing move While the number of affected companies is small relative to the 4,000-odd firms listed on local exchanges, the worst for earnings may be ahead. The unprecedented lockdown in Shanghai since March 28 shows no sign of ending, putting a strain on logistics and high-end manufacturing of items such as new-energy vehicles. The measures have prompted a warning from XPeng that China’s entire auto industry risks facing a total shutdown next month because of the damage to supply chains. Carmakers like Tesla and battery supplier Contemporary Amperex were among those affected by the lockdown in the commercial hub. Huida Sanitary Ware, a maker of ceramic products in the northern province of Hebei, said last month its plant was ordered to halt production while workers were confined to their homes and undergoing Covid-19 tests. March is the peak season for production and deliveries, so the disruption will have an impact on the business and earnings, the Shanghai-listed firm said in its exchange filing. Its stock has fallen 9.1 per cent since April, extending a 19 per cent drop in the first quarter. Zhejiang Tailin Bioengineering, which is listed on the ChiNext board in Shenzhen, had to suspend some operations at one of its units making analytical equipment from March 5, after a worker tested positive for Covid-19, the company said in a March filing. The unit accounted for 16 per cent of the company’s aggregate net income last year, it said. The shares have rebounded 14 per cent in April after sliding 21 per cent last quarter. More than 630 companies, or 13 per cent of the listings in Shanghai and Shenzhen, have published their preliminary earnings statements or forecasts for the first quarter, according to Zheshang Securities. Their net income grew by 85 per cent on average from a year earlier, it added.