China firms halt dividends, sell equity to ride out virus pandemic

HONG KONG/SHANGHAI: In this era of pandemic uncertainty, Chinese and Hong Kong-listed firms have come to one consensus on how to best survive it: sit on their wallets and preserve cash.

They are retaining profits instead of distributing them to shareholders, with the most Hong Kong dividend payers in at least 35 years opting not to do so in the first quarter. Meanwhile, though valuations recently reached a historical low in the city, firms haven’t picked up their stock-repurchase pace. Instead, sales of additional stock are near their highest since 2018.