SHANGHAI (Reuters) -More than a dozen Chinese-listed companies said they had suspended production in coronavirus-hit parts of China’s eastern Zhejiang province in response to local government’s tightened COVID-19 curbs, causing their share prices to plunge.
Zhejiang reported a total of 173 locally transmitted cases with confirmed symptoms during the Dec. 6-12 period, official numbers showed on Monday, marking the province’s first domestic cluster outbreak this year. In October, the province reported just one local case. A slew of companies, including Ningbo Homelink Eco-Itech Co Ltd, Zhejiang Zhongxin Fluoride Materials Co Ltd, Zhejiang Jingsheng Mechanical & Electrical Co Ltd and Zhejiang Fenglong Electric Co Ltd, announced the production suspension through exchange filings over the weekend.
Their shares fell sharply in early trading on Monday. Zhejiang Chunhui Intelligent Control Co Ltd and Zhejiang Yankon Group Co suffered the biggest losses, with their shares falling more than 7% each. China reported 80 new locally-transmitted cases with symptoms on the mainland for Dec. 12, including 74 identified in Zhejiang.
Ningbo Homelink, which makes plastic products, said in an exchange filing late on Sunday that it had halted production in its home city Ningbo at the request of local authorities, and is taking measures to minimise the negative impact on its business. Zhejiang Jindun Fans Co, a Chinese maker of ventilation system equipment, said on Sunday that production at its subsidiary in Zhejiang’s Shaoxing city had been suspended due to local government’s anti-virus measures.
The company said there would be some delay in product deliveries and a hit to business this month, but that the fallout on this year’s annual results would be limited. All the companies that announced production halt vowed to fully cooperate with the local government, which will decide when production can be resumed.