China In-Focus — Stocks drop; Freshippo seeks funds at lowered valuation

BEIJING: China stocks ended lower on Tuesday as strict COVID-19 curbs in Shanghai reignited worries of a wider economic disruption, while possible de-listing risks of major Chinese firms from US exchanges dragged Hong Kong shares to a 1-1/2-month low.

At the market close, the Shanghai Composite Index was down 0.97 percent at 3,281.47, while the blue-chip CSI300 lost 0.94 percent to 4,313.62.

The financial sector sub-index eased 0.17 percent, the consumer staples sector dropped 0.81 percent, and the health care sub-index tumbled 3.17 percent.

Freshippo seeks funds at $6bn valuation, down from $10bn sought earlier

Alibaba’s supermarket chain Freshippo is seeking to raise funds at a valuation of about $6 billion, much lower than a hoped-for valuation of up to $10 billion earlier this year, reported Reuters.

The company had to cut its valuation expectations after China’s COVID-19 restrictions, particularly a draconian lockdown in the economic hub of Shanghai, badly dented business, it said.

Investors are also skeptical about whether loss-making Freshippo can keep growing and turn a profit anytime soon, given the company’s bleak outlook as the world’s second-largest economy continues to pursue a strict policy of stamping out COVID-19 cases, the report cited.

The supermarket chain, known as Hema in Chinese, aims to raise $400 million to $500 million from outside investors.

China to build 461,000 km of national highway by 2035

China aims to build a total of 461,000 kilometers of the national highway by 2035, compared with 382,000 kilometers by the end of 2021, the state planner said on Tuesday.

Authorities are doubling down on an infrastructure push, dusting off an old playbook to revive a faltering economy, which has been hit by COVID-19 lockdowns, a property market downturn and soft consumer spending.

(With input from Reuters)