Shares of Lufax Holding Ltd. (06623), a leading Chinese fintech and financial services company, plummeted more than 12% in Hong Kong trading on Wednesday. The sharp sell-off came after Lufax reported disappointing second-quarter and first-half 2024 financial results, swinging to substantial net losses from profits a year earlier.
For the three months ended June 30th, Lufax posted an attributable net loss of 792.1 million yuan ($110 million), compared to a profit of 965.3 million yuan in the same period last year. Diluted loss per share stood at 0.69 yuan, missing analyst estimates of 0.58 yuan earnings per share. Total income nosedived 35.5% year-over-year to 5.98 billion yuan, also falling short of the 6.28 billion yuan forecasted by analysts.
The underperformance extended into the first half of 2024, with Lufax reporting a net loss of 1.66 billion yuan versus a profit of 1.64 billion yuan in the prior-year period. Total income for the six months slid 33.2% to 12.94 billion yuan, below expectations of 13.2 billion yuan.
Lufax's disappointing results weighed heavily on investor sentiment, triggering a massive 12.68% intraday plunge in the company's shares on the Hong Kong bourse. The fintech firm's deteriorating profitability and shrinking revenue raised concerns over its ability to navigate challenging macroeconomic conditions and heated competition in China's financial services sector.
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