(Reuters) -Hong Kong shares of Alibaba Group soared on Wednesday, marking a vote of confidence from investors after the company announced a major restructuring plan.
The stock jumped as much as 16.3% to HK$98, its highest since Feb 21, on course to snapping three consecutive sessions of losses and tracking a 14.3% rally in its U.S.-listed shares overnight.
The restructure, which was announced on Tuesday, has helped boost investor confidence in the wider Chinese tech sector, which has been battered by a heavy regulatory crackdown in recent years.
Shares of Alibaba’s e-commerce rival JD.com Inc were up 7%, and gaming giant Tencent Holdings Ltd jumped 5% on Wednesday morning.
That compared with a 2.3% jump in benchmark Hang Seng Index and a 3.2% gain for the Hang Seng Tech Index.
In Japan, Softbank Group Corp, a major shareholder in Alibaba, shot up 6%.
Alibaba said on Tuesday it would re-organise into a holding company structure, with Daniel Zhang retaining his position as group CEO, and six sub-divisions each with their own CEOs and boards.
The revamp is the most significant restructuring in the company’s history and comes after Beijing launched a years-long regulatory crackdown on the tech sector, in which Alibaba was a common target.
One day before the re-organization was announced, Alibaba founder Jack Ma, who had been out of mainland China since late 2021, was spotted visiting a primary school in Hangzhou, the city where Alibaba is headquartered.
(Reporting by Josh Horwitz in Shanghai and Donny Kwok in Hong Kong; Editing by Muralikumar Anantharaman and Sam Holmes)
Source: KFGO
