Shares of New World Development rose more than 6% on Monday after the Hong Kong property developer appointed a new chief executive just two months after it replaced Adrian Cheng, the 45-year-old scion of its founding Cheng family.
The stock climbed as high as HK$6.86 in morning trade, recovering from negative territory earlier in the session. New World‘s shares resumed trading on Monday after a halt on Friday afternoon following a 6% fall.
The company said on Friday it had appointed Echo Huang, an executive director of the company and CEO of its New World China Land since 2020, as the CEO to replace Eric Ma.
“Given NWD’s high exposure in China, we think the latest change could help NWD further strengthen its China operation and execution,” said Raymond Cheng, head of China and Hong Kong research at CGS International Securities HK.
“We however think that Echo’s lack of proven track record in Hong Kong business is her weakness and she needs to demonstrate (her abilities) and to convince (the) investment community,” Cheng said.
The surprise CEO change could also trigger corporate governance concern, he said.
Reuters
