Jul 19, 2013
Jeweller Chow Tai Fook named in price-fixing probe
Jul 19, 2013
HONG KONG - Chow Tai Fook Jewellery Group Ltd, the world's biggest jewellery retailer by market value, is among a number of gold shops being probed for price fixing, the official People's Daily newspaper reported.
Shares of Hong Kong-based Chow Tai Fook and other jewellery stores named in the report, including Chow Sang Sang International Holdings Ltd, fell on the news.
The People's Daily, citing unidentified sources, said China's National Development and Reform Commission was probing price manipulation by some jewellery shops in the commercial capital of Shanghai.
The online report, which was later reposted on a government web site, said several shops had admitted to authorities that they colluded on prices.
A spokeswoman for Chow Sang Sang told Reuters the company did not know why it had been named in the report.
"We don't understand why we got involved in the story," spokeswoman Cathy Tam said.
"We set the gold price every day based on the New York market close. The gold price is the same within the whole region of China and we don't have district differences."
A spokeswoman for Chow Tai Fook told Reuters the company planned to issue a statement in response to the report later on Friday.
Shanghai-based jewellery retailer Lao Feng Xiang , which was also named in the report, could not immediately be reached for comment.
Shares in Chow Tai Fook fell 3.2 percent by midday and was set for its worst day in four weeks, while Chow Sang Sang shed 0.8 percent.
Gold posted a record quarterly fall from April-June, luring mainland Chinese buyers to Chow Tai Fook's almost 1,800 jewellery and gold stores across China, Hong Kong and Macau.
The company earlier this month reported a 63 percent spike in first-quarter revenue, with sales of gold products from its own stores soaring 78 percent in the quarter ended June 30.
The shares of firms not named in the report also fell, with Emperor Jewellery & Watch tumbling 4.8 percent, and Luk Fook Holdings (International) Ltd falling 1.8 percent.
The benchmark Hang Seng Index was trading up 0.2 percent by midday.
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