Do not be fooled by the name: Tencent is neither a rapper nor a penny stock.
Hong Kong’s Hang Seng index — comprisingHong Kong blue-chips as well as leading China “red” chips — has rallied by more than one-tenth this month, and returned one-quarter since January. The Chinese mobile gaming and messaging platform Tencent is enjoying the ride. The company, which owns the messaging app WeChat, began the year with a market capitalisation of $120bn. On Monday it was briefly valued at more than $200bn, larger than HSBC.
No surprise, then, that some people are taking profits. After market on Monday, the company revealed that its chairman and founder, Ma “Pony” Huateng, sold part of his holding last week, raising more than $400m. On Tuesday, sellers pushed the stock down as much as 8 per cent on big volumes as they followed him out. Mr Ma may not be the best lead to follow; last December he sold part of his holding at a price around one-fifth below current levels.