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Tencent lost its place in the top ten largest companies in the world

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Tencent lost its place in the top ten largest companies in the world
October 12
09:00 2018

This year, an Internet giant Tencent (China) has lost $ 220 billion. The company has lost its place in the list of ten largest companies in the world.

Securities of the company have been falling for nine consecutive sessions in a row. This period is a record in duration. On Wednesday, the shares fell by almost 2% to 282 Hong Kong dollars. They have fallen below the psychological mark of 300 Hong Kong dollars for the first time since last summer. Since January, the company’s value has decreased by 40%. This figure was a record among the losses of world companies for this year.

At the beginning of 2018, Tencent could boast that it was one of the five largest companies in the world (along with Apple, Microsoft, Google and Amazon).

Its capitalization was just over $ 350 billion that helped Exxon to go faster than Tencent. The cost of Exxon was equal to 365 billion dollars. The Chinese giant tried to stop the fall and began to buy back its own papers, but so far this measure has had no effect. Since September, the company has already spent about $ 100 million to repurchase the securities.

Tencent placed its papers on IPO in 2004. Then they cost 3.7 Hong Kong dollars per share. Since that time, they have risen by more than a hundred times. The great success of published games and mobile applications (for example, WeChat) helped the company to establish itself in the status of a major investor and a serious player in the global market.

This year the market began to treat the company differently. The reason for this was the general doubts that the prices of Tencent and other techno-companies were unjustifiably overestimated. In March, it was reported about a decrease in a profit margin. At the same time, Naspers, one of the largest investors, got rid of its share, which was estimated at $ 11 billion.

Then Tencent recorded a drop in a quarterly profit, which happened for the first time in 10 years. An additional blow for the company was the restriction on the mobile gaming market, introduced by the authorities of the country.

 

The material was prepared with the participation of Anjela Chromova,
a leading analyst of the brokerage company CT Trade

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