Tencent Holdings tumbled by the most in seven weeks amid speculation its largest shareholder Prosus NV may speed up selling shares in the Chinese internet giant.
Prosus plans to deposit an additional 96 million of shares into the Hong Kong stock clearing system. The move may signal a quicker selling pace and put pressure on the stock, even though Tencent has been repurchasing shares, according to traders. Tencent fell as much as 4.9% to HK$358 on Wednesday, the most since February 21.
“It’s likely that Prosus will speed up their selling of Tencent shares when it’s near the level of HK$400,” said Steven Leung, UOB Kay Hian executive director. “Tencent has been buying back their shares to offset the market impact of big holders selling every day, but still, such negative news would always cause some concern.”
As of January this year, Prosus had sold more than 193 million Tencent shares for a net proceed of $7.2 billion, cutting its stake to about 26.9% from 29% in June 2022 when it first announced the selloff plan.
Tencent has bought back a combined 8.3 million shares, snapping up almost every trading day since March 27, after suspending the operation for more than two months, according to data compiled by Bloomberg. Its buybacks earlier didn’t manage to stem the stock declines when the market was concerned about a regulatory crackdown and Covid’s impact on the economy.
Shares of Tencent have rebounded 90% from its October low. The company’s plan to develop a ChatGPT-like bot and Beijing’s resumption of game approval have boosted its fortunes.
“Tencent’s share price always takes a hit when there’s news of Prosus selling,” said Vey-Sern Ling, managing director at Union Bancaire Privee. “But the sale doesn’t affect the fundamentals of Tencent.”
Get South Africa’s latest entrepreneurial or business success stories delivered right to your inbox — Sign up to Entrepreneur Hub SA’s newsletter today
eBook: 50 South African Entrepreneurs Reveal HOW THEY MADE IT
Wow, marvelous blog structure! How lengthy have you ever been blogging for?
you made blogging look easy. The total glance of your site is great, as
neatly as the content material! You can see similar here najlepszy sklep
Hi there! Do you know if they make any plugins to assist with
SEO? I’m trying to get my blog to rank for some targeted keywords but I’m not
seeing very good gains. If you know of any please share. Many
thanks! You can read similar art here: Backlink Portfolio