Shares of Chinese food delivery giant Meituan slumped further on Tuesday in a sell-off precipated by the social media posting by its chairman of an ancient poem that was perceived by some as criticising the government and President Xi Jinping.
The company, which recently raised $10 billion, has lost $30 billion in market value over two days amid a broader drop in Chinese tech shares as investors remain jittery over a regulatory clampdown that last month ensnared Meituan.
The poem, posted on May 6 by Chairman and CEO Wang Xing on a small social media site that he founded, criticises the emperor of the Qin dynasty, who burnt books to suppress intellectual dissidents, only for it to be overthrown by illiterates.
While many on Chinese social media interpreted the posting as an allusion to the anti-monopoly campaign backed by Xi, Wang on Sunday said he was referring to business rivals, saying that “the most dangerous opponents are often unexpected ones”.
The original posting has been removed.
Meituan declined further comment.
Adding to investor concerns, the Shanghai Consumer Council said late on Monday that it had summoned Meituan and e-commerce firm Pinduoduo (PDD.O), accusing them of violating consumer rights.
On Tuesday, Meituan shares tumbled 5.3% to a seven-month low.
“I think mainland investors paid more attention to the poem, but international investors are more worried about the rising cost of employing riders of the company,” said Fred Wong, chief investment officer at Hong Kong-based eFusion Capital.
He was referring to social media criticism of Meituan and other industry players’ treatment of delivery riders, most of whom are not covered by basic social and medical insurance.
The Hang Seng Tech Index (.HSTECH), which includes Chinese tech giants Alibaba (9988.HK), Tencent (0700.HK) and JD.com (9618.HK), dropped as much as 4.5% on Tuesday to a six-month low.