SMIC dives 23pc on fears of US clamp

Shares of Semiconductor Manufacturing International Corporation (0981) plunged 22.88 percent to HK$18.24 yesterday on reports of a possible United States blacklisting.

SMIC said it had no ties to the Chinese military after Reuters reported that the Trump administration is considering whether to add SMIC to a trade blacklist, citing a Defense Department official, as the United States escalates its crackdown on Chinese companies.

Research firm Jefferies estimates that roughly half of SMIC's suppliers are American. But even if SMIC is sanctioned by the US, China can still get 5G chips through other channels, according to Credit Suisse.

Goldman Sachs estimates that SMIC's revenue could be halved by 2024 if the company is unable to expand capacity in both advanced and older nodes.

It will take China two or three years to move the entire semiconductor production chain domestically, said IMA Asia managing director Richard Martin in an interview with CNBC.

In Hong Kong, the Hang Seng Tech Index was down 4.57 percent to 7,240 on Monday, compared to the Hang Seng Index's 0.43 percent.

Blue-chip newcomers Alibaba (9988), Xiaomi (1810), and WuXi Biologics (Cayman) (2269) all retreated on Monday. WuXi Biologics dived 3.56 percent to HK$181.5, the worst performer among blue-chip stocks. Alibaba dropped 3.07 percent to HK$265.6, and Xiaomi fell 1.43 percent to HK$24.15.

Mobile phone gear makers fell, with AAC Technologies (2018) down by 2.61 percent to HK$46.7 and Sunny Optical Technology (2382) down 2.37 percent to HK$115.3.

Hong Kong Television Network (1137) plummeted 18.35 percent to HK$10.68, after the company said last Friday that average daily order number fell 9.4 percent to 32,900 in August from July.