The stock of China's leading technology company Tencent Holdings fell flat on the hong kong Stock Exchange this week. The reason for this is the decision of the US Department of Defense which shook this Chinese giant company. This Chinese tech company has been put in the category of Chinese military companies by the US Department of Defense, due to which a sharp decline in the stock was seen. There was a sharp decline in the depository receipts of Tencent Holdings on Wall Street in America.
China's Tencent Holdings has purchased a large number of shares from the open market to take advantage of this sharp decline in the stock. For the first time in the last two decades, after the year 2006, Tencent Holdings Ltd has bought back its shares on this scale. Tencent Holdings bought back about 3.93 million shares on the hong kong exchange.
Tencent Holdings is not the only company buying shares after the fall. But big Chinese investors also took advantage of the opportunity and bought shares worth 14 billion hong kong dollars, which is the biggest purchase made in a day. Chinese investors are estimating the fair value of Tencent Holdings shares to be 704 hong kong dollars while the current price is 378 hong kong dollars.
Tencent Holdings is one of the most valuable companies in China. The US Department of Defense blacklisted the company, but the company says that it will work with the US Department of Defense to clear the confusion created by them regarding this matter. The US Department of Defense has also blacklisted China's battery manufacturing company CATL and has termed it a Chinese military company.
Both the companies Tencent Holdings and CATL say that they are not military companies and neither are involved in this activity. After the decision of the US Defense Department, after Tencent Holdings, CATL's stock has also seen a sharp decline. These days America is taking a tough stand on transferring high-end technology to China. Last year in May 2024, it had also revoked the license to sell chips to China's Huawei.
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