Sunny Optical in bloodbath

Finance | Avery Chen 15 Aug 2018

The Hang Seng Index has remained in the red for three days, down 0.66 percent at 27,752.93 yesterday.

Blue chip Sunny Optical Technology (2382) was the biggest loser, plunging 29.20 percent to HK$91.90, its lowest level since August last year.

The handset equipment company posted on Monday a 1.8 percent year-on-year increase in interim net profit to 1.18 billion yuan (HK$1.35 billion), which was far below market expectations.

Morgan Stanley lowered its rating to equal weight from overweight, with a target price of HK$120, down 36.84 percent. Nomura also adjusted the rating to "neutral" from "buy," the target price down 15.63 percent to HK$153.

Another handset equipment blue chip, AAC Technologies Holdings (2018) also continued to lose, down 7.15 percent to HK$85.75.

Tech giant Tencent Holdings (0700) lost 3.43 percent to HK$348.60 one day before its interim result announcement, after Chinese regulators blocked the sale of a popular game named Monster Hunter: World from its games distribution platform WeGame.

Software shares also slumped. Kingdee International (0268) fell 8 percent, while Kingsoft (3888) saw an 18.84 percent loss to HK$13.18, after saying that it expected to record a loss for the three months ending September 39, 2018, and even for the financial year of 2018.

The online literature platform China Literature (0772) slumped 16.19 percent to HK$56.15 as of 2pm, which is the biggest drop since its initial public offering in November 2017. The Tencent spinoff yesterday announced it would acquire New Classics Media for 15.5 billion yuan.

China Literature also posted an interim net profit of 505.81 million yuan, up 13.86 percent. Earnings per share amounted to 0.58 yuan, no interim dividend was declared.

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