As Nikkei Asia reported, the electronics retailer Suning.com’s shares plunged around 10% on Monday as China’s domestic stock market reopened following a week-long Lunar New Year break but rebounded to close at 3.63 yuan (US$0.57), down about 3%. Since the beginning of 2021, the retailer’s stock has already lost half of its worth.
Suning.com, based in Nanjing, said on Jan. 28 that it expects a net loss of between 42.3 billion yuan and 43.3 billion yuan (US$6.65 billion—US$6.81 billion) in 2021.
Earlier, It recorded a loss of 4.27 billion yuan ($0.67 billion) in 2020.
Suning expects to lose about half of its revenue due to two joint ventures. One of them is Shenzhen Hengning Business Development, a 49/51 joint venture with Hengda Real Estate, Evergrande’s central operating unit.
The retailer said it expects to record a loss of 10.3 billion yuan (US$1.62 billion) from the performance last year, while Suning valued its investment in the joint at 10.8 billion yuan (US$1.7 billion) in its 2020 annual report.
Shanghai Xingtu Financial Service Group, an online financial provider, is Suning’s second loss joint venture.
Suning said it would lose a net 8.9 billion yuan (US$1.4 billion) due to Xingtu’s losses and impairment in the value of its 41 percent ownership in the partnership, Due to an “adjustment cycle” prompted by stricter internet financing restrictions.