Yangzijiang Shipbuilding Holding’s share price plummeted over 15% when trading resumed on the SGX after a one-week halt. The share price opened at SGD 0.91 and hit the lowest level of SGD 0.79 before crawling back to SGD 0.90 at 11.00am.
One stock broker says the sell-off of Yangzijiang shares was carried out by some financial institutions and public investors.
“The news of Yangzijiang Shipbuilding’s chairman Ren Yuanlin being asked to step away from the company for some investigations by the Chinese government has not been well received by fund managers,” said the stock broker. “When news of this type takes place, they (fund managers) need to dump some shares.”
“The drop in the Dow by 800 points to 25,479.42 has also contributed to the fall of Yangzijiang’s share price. It is the accumulation of these two factors,” he added.
Shipbuilding players familiar with Yangzijiang say the shipyard is still operating as per normal under the stewardship of chief executive officer Ren Letian - Ren’s son.
“Operation of Yangzijiang’s shipyard is as per normal,” said one shipbuilding player. “It delivered a feeder containership to Regional Container Lines (RCL) yesterday.”
Despite Ren Yuanlin’s absence, Yangzijiang and Japan’s Mitsui E&S Shipbuilding went ahead and launched the joint venture shipyard Jiangsu Yangzi-Mitsui Shipbuilding today.
Jiangsu Yangzi-Mitsui Shipbuilding is incorporated in China with a registered capital of $99.9m. The joint-venture company plans to construct mid-size LNG carriers before progressing on to 180,000-cbm ships.
Ren’s investigation by the Communist Party of China's anti-graft body has been linked to a retired local party official, Liu Jianguo.
According to an announcement by Beijing’s Central Commission for Discipline Inspection (CCDI), Liu was under investigation for “suspected of serious violations of the law”.
Liu was once the chairman of the management committee of Ren Yuanlin’s private Jiangsu Yuanlin Charity Foundation.
