UBTech’s Market Meltdown: A Stormy Monday for China’s Robot Giant
The future of humanoid robotics took a dramatic tumble this week as UBTech Robotics, China’s largest maker of humanoid robots, witnessed a staggering HK$12 billion (US$1.6 billion) evaporate from its market value. Monday’s 30% nosedive in Hong Kong trading came hot on the heels of the expiration of a lock-up period for major shareholders’ stakes, triggering widespread fears of insider sell-offs. While founder Zhou Jian attempted damage control with a promise to extend his lock-up period for most of his shares, investors weren’t convinced, leading to the company’s sharpest decline since its December 2023 listing.
The sell-off couldn’t have come at a worse time for Hong Kong’s fragile stock market. With the Hang Seng Index up 18% this year but still haunted by uncertainty over Beijing’s stimulus policies, UBTech’s tumble added salt to the wound. Analysts have been cautious about the market’s ability to sustain its September rebound, and UBTech’s woes only underscore the jittery sentiment.
UBTech’s financial health isn’t helping its case. Known for its Star Wars-themed toy robots, the Shenzhen-based company has racked up losses for four consecutive years, with a 2023 annual deficit ballooning to 1.23 billion yuan (US$168.5 million). Its first-half loss for 2024 wasn’t much better, standing at 516.4 million yuan. Despite raising HK$1 billion in its initial public offering late last year, the stock has failed to regain its IPO price of HK$90, closing Monday at HK$63.80—a bleak picture for a tech company once lauded as the leader in humanoid robotics.
To add to the drama, UBTech announced a shake-up in its corporate governance. Zhou and five other shareholders terminated a “concert party” agreement, effectively dissolving a pact that required aligned decision-making at board meetings. While the company framed the move as a step toward streamlining operations, investors interpreted it as a sign of disunity, further stoking fears. As UBTech grapples with investor confidence and financial losses, the question looms: can China’s robotic star find a way to rise again, or is this the beginning of its fall from grace?
(Source: MSN | SCMP)
