(Yicai Global) June 23 -- Shares of LBX Pharmacy, a Chinese discount superstore drug chain operator, fell for a second day, further retreating from a five-year high despite plans for a CNY600 million (USD84.9 million) capital injection from the investment arm of Chinese tech giant Tencent Holdings.

LBX Pharmacy’s stock price [SHA:603883] lost 3.6 percent today to close at CNY95.40 (USD13.50) after falling a little over 4 percent yesterday. Last week, the shares advanced almost 26 percent to CNY103.25 apiece, the highest since May 28, 2015.

LBX will issue new shares priced at CNY70.34 each to Shenzhen Tencent Industrial Investment Fund in a private placement that will give the investor a 2.84 percent stake, the Changsha-based retailer said.

Tencent has shown a keen interest in investing in chain stores in recent years with the aim of shaking up traditional retailing. It has backed supermarket chain operator Yonghui Superstores among other well-known brick-and-mortar players. With more than 4,500 outlets and over 34.39 million members, LBX Pharmacy presents a very attractive package.

The new financing will help LBX significantly reduce its debt ratio and exposure to financial risks, the firm said. In recent years, rapid expansion saw the chain’s asset to debt ratio rise to 61.65 percent at the end of March from 39.69 percent at the end of 2015, putting it at the high end of the scale among competitors in the industry.

Shenzhen-based Tencent will leverage its strengths in internet technology and online platforms to help improve the drug retailer’s core competitiveness, LBX said. Areas of cooperation include smart retail, cloud computing and cloud services, it added.

Tencent [HKG:0700] reached a record high of HKD498.60 (USD64.33) during trading today, and closed 4.9 percent up at HKD497.40.

Editor: Kim Taylor