China’s richest individuals have experienced significant financial losses due to sharp declines in their companies’ stock prices and broader concerns about the country’s economic outlook.
Nongfu Spring Co.’s Zhong Shanshan, China’s wealthiest person, saw his fortune decrease by approximately $4 billion on Wednesday. This drop occurred as Nongfu Spring’s shares fell as much as 12.9% in Hong Kong trading. The decline left Zhong with a total net worth of $45.5 billion, according to the Bloomberg Billionaires Index.
Meanwhile, PDD Holdings Inc.’s founder Colin Huang faced an even steeper drop. On Monday, Huang’s wealth plummeted by $14.1 billion, marking the largest one-day loss in the history of Bloomberg’s wealth rankings. The plunge followed PDD Holdings’ warning of diminished revenue growth prospects. Huang, who briefly held the top spot on the Bloomberg Billionaires Index earlier this month, is now fourth. His wealth continued to decline on Tuesday, with a further 4.1% drop in PDD shares, reducing his net worth by an additional $1.4 billion. Tencent Holdings Ltd. co-founder Pony Ma has now taken the second spot on Bloomberg’s tracker.
These losses highlight mounting concerns about the robustness of Chinese consumer demand. Both Nongfu Spring and PDD Holdings, major players in their respective markets, are facing challenges from a sluggish economy. The beverage industry, where Nongfu competes, and the e-commerce sector, where PDD operates, are struggling to maintain growth amid weakening consumer spending.
Nongfu Spring has seen a substantial drop in revenue from its packaged drinking water products, which fell by 18% in the first half of the year. The segment’s contribution to total revenue has decreased to about 39% from 48% last year. This decline is partly attributed to negative public sentiment toward Nongfu and Zhong, exacerbated by recent controversies, including criticisms following the death of Zong Qinghou, founder of a key rival, and concerns about water quality raised by Hong Kong’s Consumer Council.
PDD Holdings, the owner of the Temu e-commerce platform, has also faced difficulties, including protests from merchants over perceived unfair penalties and increased regulatory scrutiny in Europe aimed at closing tax loopholes for low-cost online goods. The company’s struggles have led to substantial wealth erosion for Huang, underscoring a broader issue of weakening confidence in Chinese consumer sectors.
Li Xuetong, a fund manager at Shenzhen Enjoy Investment Management Co., noted that both Nongfu and PDD are facing aggressive competition from rivals eager to capture their market share. “The fierce competition and changing consumer dynamics have forced investors to reconsider the stability of these once-dominant companies,” Li said.
The significant losses experienced by Zhong and Huang reflect broader economic uncertainties in China, where many leading businesses are grappling with slower demand and shifting market conditions.
