After news broke of last week’s arrest of JD.com Inc. CEO Richard Liu in the U.S. on an allegation, shares of the eCommerce company fell by 6 percent. The CEO has denied any wrongdoing through his lawyers and left custody without charges or having to pay bail, Reuters reported.
An analyst for Guotai Junan said the price of shares could fall further in the event that police do, in fact, charge Liu. However, he noted that the stock would not see a steep crash, as it has already fallen sharply this year. At the same time, Liu’s lawyers do not think that he will be charged, and defense attorney Joseph Friedberg said that “there’s no credible complaint.”
Lawyers in China said that while there wouldn’t be many legal channels to make Liu return to the U.S. if he were to be charged, he would not likely refuse to do so, as it could adversely impact his business interests, the newswire reported.
The news comes as JD.com’s annual 618 Shopping Festival brought in $24.6 billion, according to data from Coresight Research. In a report, Coresight said the shopping festival, which ran from June 1 through June 18, saw a year-over-year increase of 37 percent. Mobile phones, PCs, air conditioners, digital products and food and beverages were the leading categories.
For the event, JD.com partnered with more than half a million physical retail stores. In-store sales saw a big jump on June 18 with JD Daojia, JD.com’s online-to-offline service that delivers groceries and fresh food, driving the growth. Meanwhile, Walmart participated again this year and saw sales jump fourfold, which was tiny compared to local Chinese retailers. Yonghui Superstores saw sales increase by five times last year, and Century Lianhua had sales that were up seven times compared to a year ago.