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Some Chinese companies suspend production in Zhejiang province on virus outbreak -Breaking

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© Reuters. FILE PHOTO – Lines of trucks can been seen at Ningbo Zhoushan port (Zhejiang Province, China), August 15, 2021. Image taken August 15, 2020.

SHANGHAI (Reuters), Several Chinese-listed companies stated that they have stopped producing in parts of China’s Eastern Zhejiang province, which is coronavirus-affected. The decision was made by the local government to increase COVID-19 limits. It caused share prices to plummet.

Zhejiang had 173 confirmed cases of locally-transmitted disease during the December 6-12 period. Official numbers were released Monday. It was Zhejiang’s first domestic cluster crisis this year.

The province only reported one local case in October.

A slew of companies, including Ningbo Homelink Eco-Itech Co Ltd, Zhejiang Zhongxin Fluoride Materials Co Ltd, Zhejiang Jingsheng Mechanical & Electrical Co Ltd and Zhejiang Fenglong Electric Co Ltd, announced the production suspension through exchange filings over the weekend.

They saw their shares fall sharply during early trading Monday. Zhejiang Chunhui Intelligent Control Co Ltd & Zhejiang Yankon Grup Co were the worst offenders, their shares dropping more than 7%.

China has reported 80 cases of locally transmitted symptoms in China for December 12, with 74 being identified in Zhejiang.

Ningbo Homelink (a maker of plastic products) stated late on Sunday in an exchange filing it had suspended production in Ningbo on the demand from the local authorities and that it is now taking precautions to reduce the adverse impact on the business.

Zhejiang Jindun Fans Co., a Chinese producer of ventilation system equipment, stated on Sunday, that production in its Shaoxing, Zhejiang, subsidiary was suspended by anti-virus measures.

Although there might be delays to product deliveries, the company stated that this will not affect business operations. The impact of this on annual results for next year would however be minimal.

All companies who announced a production stop vowed full cooperation with the local government. The latter will determine when production can resume.

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