JD.com shares soar after beating sales estimates, Acotec tumbles in HKSE debut
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JD.com Inc. shares soared more than 10% on Tuesday after the company exceeded sales estimates thanks to improving consumer spending and seemingly undeterred by tightening regulations on the Chinese internet sector.
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JD.com shares in Hong Kong (HK:9618) soared 10.10% to HK$268.20 ($41.32) by 12:51 AM ET (4:51 AM GMT). The company’s New York shares (NASDAQ:JD) rose 3.32% to $65.73.
The company recorded a 26% rise in revenue to CNY253.8 billion ($39.1 billion) for the three months ended June 2021. Higher transaction volumes during the annual JD.com 6.18 shopping festival and the double-digit rebound in retail spending in China during the June quarter, also contributed to the better-than-expected results.
However, the latest outbreak of COVID-19 in China slowed down the country’s economic recovery, as much of the country went under strict lockdown towards the end of July.
Although JD.com hasn’t faced a high-profile probe or crackdown since regulations were tightened, its shares have dropped around 40% from a high hit in February as investors retreat from the sector.
“JD has always paid great importance to data security and personal information, so the arrival of the new regulations is not making a big impact on us in terms of our advertising business,” Chief Executive Officer Xu Lei said during a conference call.
However, “we are faced with multiple challenges,” he added.
Meanwhile, medical device maker Acotec Scientific Holdings Ltd. (HK:6669) made a dismal debut on the Hong Kong Stock Exchange (HKSE) on Tuesday. Its shares tumbled 25.13% to HK%17.82, after opening at HK$18.32.
Healthcare technology platforms also face tightened regulations, with Chinese media reporting during the previous week that approval from the government for the methods of diagnoses, prescriptions and use of medicine is now required to ensure safety.