(Yicai) Jan. 16 -- Shares of YH Entertainment Group plunged after the Chinese artist management agency released updates on multiple cases regarding the reputation protection of its main client Wang Yibo, a Chinese actor and singer.

YH [HKG: 2306] closed 77 percent down at HKD1.30 (17 US cents) as of 3.45 p.m. in Hong Kong today, after earlier sinking 80 percent to the lowest since listing in January last year.

YH won two of the six cases against social media accounts denigrating Wang, one is waiting for the ruling, and the remaining three are in progress, the Beijing-based firm announced yesterday. YH will continue to proactively safeguard Wang’s legitimate rights through legal means, it added.

It is worth of notice that YH’s one-year ban on major shareholders and corporate executives from selling the company’s shares will expire on Jan. 19. The shares that will be unlocked will equal about 40 percent of YH’s total.

Some investors probably believed that some equities would be soon released to the market, so they hurried to sell their shares before the stock price fell, said Yan Zhaojun, a strategic analyst at Zhongtai Financial International, Shanghai Securities News reported.

“Due to the Hong Kong Stock Exchange’s low trading volume and high concentration of stocks, there is always a centralized selling pressure on the market whenever a selling ban is lifted, so the stock collapses due to insufficient market capacity,” Yan noted.

Founded in 2009, YH is mainly engaged in the management of artists, production and operation of music-relevant intellectual properties, and pan-entertainment business.

In the first half of last year, YH reported business revenue of CNY365 million (USD51.3 million), down 25 percent from a year earlier. The firm logged CNY176 million in net loss in the period, versus a net profit of about CNY267 million in 2022, mainly because of changes in the fair value of convertible preferred shares.

Editor: Futura Costaglione