Gulf Today

China app giant Meituan tumbles

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SHANGHAI: Shares of Chinese online giant Meituan plummeted for a second straight day on Tuesday amid a run of bad headlines that included the CEO posting an ancient poem viewed as a veiled criticism of China’s government.

Meituan’s Hong Kong-listed shares closed more than five percent lower on Tuesday -- and down around 12 per cent since last week -- as investors bet it would become the next big Chinese tech company humbled by government regulators.

Beijing has moved aggressive­ly to loosen Big Tech’s hold on the daily finances of consumers and -- analysts believe -- to curb the sector’s growing influence on society by using antimonopo­ly probes.

Regulators hit e-commerce titan Alibaba, co-founded by billionair­e entreprene­ur Jack Ma, with a record $2.78 billion fine last month for abusing its market dominance with anticompet­itive practices.

Two weeks ago regulators said they had also launched a similar probe of Meituan, a consumer lifestyle super-app through which users order consumer goods and book entertainm­ent, health and leisure services.

Resulting pressure on Meituan shares turned into a rout ater CEO Wang Xing last Thursday posted on social media a classic ancient poem about the tyrannical rule of China’s first emperor, which was widely viewed as a swipe at authoritie­s.

The current broad tech clampdown gained pace only ater Ma publicly criticised regulators in October, so Wang’s post sparked fears of similar retributio­n against Meituan.

Compoundin­g Meituan’s troubles, an influentia­l Shanghai consumer advocacy group on Monday accused the plaform of problems with refunds and misleading content on its mobile app.

“Using such a cryptic poem at such a sensitive time, investors will shiver in fright,” said a posting on Gelonghui, a popular stock-discussion account on China’s Twiter-like Weibo.t

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A Meituan delivery man in yellow goes on his rounds in Shanghai, China, on Tuesday.
Associated Press ↑ A Meituan delivery man in yellow goes on his rounds in Shanghai, China, on Tuesday.

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