New | China's Baofeng Technology stock set for stormier days ahead
Video firm's shares have taken a big tumble and will likely remain volatile
Once dubbed this year's most charming share in China, online video firm Baofeng Technology has taken a big tumble in the market rout, wiping out its chairman Feng Xin's fortune.
The March 24 trading debut of Baofeng, which means storm, at 7.14 yuan (HK$8.85) per share made Feng, who holds a 21.3 per cent share of the firm, a billionaire. The highest-flying stock in the A-share market rose as much as 45 times to 327.01 yuan per share on May 21, bringing Feng's wealth to 8.2 billion yuan.
But the market slump cut the share price of the firm, which focuses on video-downloading software and digital products, by more than half from its peak.
Based on its closing price of 132.66 yuan yesterday, the value of Feng's shares had dropped 4.8 billion yuan to 3.2 billion yuan from May.
The benchmark Shanghai Composite Index fell about 30 per cent last month from its peak in mid-June.
Baofeng's shares fell by the maximum 10 per cent daily limit for five consecutive trading days from July 13 when it returned to the market after a trading halt from June 10.
Since its debut, Baofeng stocks have recorded trading suspensions of more than 30 trading days because it had risen by the 10 per cent daily limit. The sharp rise caused retail and institutional investors to snap up the shares despite their high valuation.