Shares of China’s multi-service platform Meituan Dianping closed at an all-time high on Tuesday, as investors continued to buy into the Tencent-backed super app.

Why it matters: Meituan business is widely exposed to Covid-19: Most of the merchants on its platform operate offline and the services they offer are highly dependent on disposable income and consumer confidence.

  • As the pandemic’s impact in China has leveled off and lockdowns have been lifted, offline business are gradually coming back to life.
  • Tuesday’s gains in Meituan’s stock signal that investor confidence in the economy is returning.

Details: Meituan’s market cap hit a company high of HK$1.28 trillion ($182.53 billion) on Tuesday with shares up 8.67% to close at HK$218 apiece.

  • Meituan’s billionaire founder and chairman Wang Xing added RMB 12.6 billion ($1.8 billion) to his personal net worth on Tuesday, bringing the total to more than RMB 118.3 billion.
  • “Meituan is not a company that exists for the high share price, and that is even more true for me personally,” (our translation) said Meituan’s outspoken founder Wang Xing in a Tuesday post on Fanfou, the social media platform he founded.
  • Hong Kong stock exchange ended higher on Tuesday, led by strong gains in technology firms.

Context: Meituan’s share price has more than doubled in 2020 after starting the year at about HK$100 in January, then sliding to roughly HK$70 in March during the height of the coronavirus lockdown.

  • Meituan’s grocery delivery business, along with a number of other companies in the sector, boomed during the pandemic while the country was under lockdown.
  • Meituan is testing a new Pinduoduo-style group buying feature for its core food delivery services.
  • To fend off rival Ant Financial, Meituan in July blocked payments through Alipay, which is expanding into the local services sector—traditionally Meituan’s core business.
  • As it continues to rebound, Meituan is expected to see co-founder and senior vice president Wang Huiwen retire from management by the end of 2020.

Emma Lee

Emma Lee is Shanghai-based tech writer, covering startups and tech happenings in China and Asia in general. We are looking for stories related to tech and China. Reach her at lixin@technode.com.