China’s focus on designing and manufacturing its own silicon chips has been rocked again by widening losses at a state-backed national champion that the government has poured billions of dollars into.
Tsinghua Unigroup, long thought to have ironclad backing, went out of its way yesterday to trumpet that support after market turmoil. Unigroup said it had not defaulted on any bonds and had ample cash “in and outside” the country in a statement from a listed subsidiary. The share price of one of its Shenzhen-listed subsidiaries plunged by the 10 per cent limit on Wednesday while the price of its dollar-denominated bond due in 2021 fell sharply.
The statement appeared to reassure investors as shares of its listed units nudged upwards while its dollar debt was also largely steady.