After the Indian government pulled the plug on PUBG and 117 other Chinese apps, Shenzhen-based tech conglomerate Tencent’s shares fell more than 2% or lost $14 Bn in intra-day trade. This is the second biggest fall in market value for the company in recent times.
The Hong Kong Stock Exchange (HKEX) website data revealed that the stock of Tencent Holdings traded 2.02% lower at HK$534 on Thursday (September 3).
According to a Bloomberg report, Tencent’s valuation had dropped by $35 billion between late July and early August.
This ban has come as a big blow for the gaming giant as India had contributed 24% or 175 million out of PUBG’s lifetime 734 million downloads till June. A report by Sensor Tower also revealed that PUBG was the most downloaded gaming app in the world in the first half of the ongoing calendar year or H1 2020. China, Turkey, Russia and Egypt were the remainder in the top 5 list.
PUBG’s mobile version was developed by Tencent which holds around 10% stake in the parent company.
In July, the ministry of information technology had banned 59 Chinese mobile apps including TikTok, UC Browser, ShareIT, ES FileExplorer, Clash Of Kings, Helo, Likee, CamScanner, Shein among others on the grounds of threat to sovereignty and security of the country.
The ban follows rising tension between China and India. Rising geopolitical tensions between the two countries, since border clashes between the two armies in Ladakh’s Galwan Valley last in June, are now manifesting in trade and economic ties, with members of the Indian political brass calling for a boycott of Chinese products and services.
In the recent past, Chinese apps have been flagged for alleged violations of data privacy norms. Following the ban on 59 Chinese apps, including popular ones such as ByteDance-owned TikTok and Alibaba-owned UC Browser, some of the banned applications hinted at moving their data servers to India, to assuage the government’s concerns over data security violations.