Meituan’s plunge — which combined, has wiped out more than $62 billion in market value for the company since Friday — came as Chinese regulators issued new guidelines Monday calling for improved standards for food delivery workers.
China’s State Administration for Market Regulation said in a statement that companies should take steps to ensure that riders make at least the local minimum wage, to reduce the “intensity” of the workload, and to “strengthen traffic safety education and training,” among other measures.
“We are committed to improving our compliance standards to protect the rights of our stakeholders, which include delivery riders,” it added. “We believe that the publication of the new guidelines will beneﬁt the healthy development of China’s internet industry as a whole.”
Meituan’s shares have sunk more than 34% so far this year.
Tencent’s declines over the past two days, meanwhile, have erased more than $100 billion from its market value.
Tencent was also hit by a regulatory order over the weekend to scrap its plan to acquire another music streaming player, China Music Corporation. Regulators cited competition concerns, noting that the Shenzhen-based tech giant has already long been leading the market.
Tencent said in a statement Saturday that it “fully” accepted the decision, and would “strictly follow the regulatory requirements.” It also pledged to “fulfill our social responsibilities and contribute to healthy competition in the market.”
A palpable chill
In total, the three tech giants — Tencent, Meituan and Alibaba — have lost more than $237 billion over the last 48 hours.
The Hang Seng TECH Index, a Nasdaq-like technology index that tracks the largest tech firms trading in Hong Kong, fell as much as 8% on Tuesday, bucking the regional trend among many major indexes.
New rules published over the weekend took aim at fast-growing tutoring companies, barring them from turning a profit or raising funding on stock markets. The announcement from China’s Ministry of Education has wiped billions of dollars off the market value of several major, publicly-traded education firms.
In some cases at least, investors’ concerns may be overblown, according to Jefferies analyst Thomas Chong, who reiterated a recommendation to buy Meituan’s stock Tuesday.
The firm has long been working to improve conditions for riders, even hosting about 100 sessions with workers since last year to collate feedback, he wrote in a note to clients Tuesday.
“We view [the] share price pullback about guidelines details as overdone,” Chong added.
-— CNN’s Hong Kong bureau and Julia Horowitz contributed to this report.