Due to the chairman's sex scandal, China's leading AI computing power company, Shenghong Technology, saw its market value evaporate by 20 billion yuan (about 12 billion MYR). The company responded to the media, stating that the circulated video is unrelated to the company's production and operations, and will not affect the company's daily business activities.
According to Daily Economic News and Phoenix News, Shenghong Technology, with a total market value of about 360 billion yuan (about 216.6 billion MYR), has become embroiled in public controversy over rumors relating to the "Elevator Incident."
Last Saturday, a social media user nicknamed "珍珍Janice" posted multiple pieces of information regarding Shenghong Technology chairman Chen Tao's private life. One elevator surveillance video showed a middle-aged man, suspected to be Chen Tao, intimately interacting with a woman dressed in white.
On Monday, Shenghong Technology's A-shares plummeted, closing down 7%, with more than 20 billion yuan in market value wiped out within half a day.
On Monday, Shenghong Technology told the media that the circulating information is unrelated to company operations, does not involve any major issues concerning company governance or internal controls that require disclosure, and that the company’s overall production and operations have not been impacted.
When asked whether the chairman was reporting to work as normal, Shenghong Technology stated that this fell under personal privacy and was inconvenient to discuss.
Shenghong Technology is a core supplier for Nvidia in the AI server PCB (printed circuit board) sector, with a supply share representing about 50% of global data center PCBs. The 54-year-old Chen Tao is the founder of Shenghong Technology.
On May 28 this year, at the invitation of Nvidia CEO Jensen Huang, Chen Tao attended the high-level, closed-door “Trillion-Yuan Banquet” in Taipei, and was the only mainland Chinese supplier representative for the second year in a row. Last year, Shenghong Technology's value soared by 600%.