Home NewsCoronavirus Whilst the virus will see many sectors in China suffer, others may see some benefits

Whilst the virus will see many sectors in China suffer, others may see some benefits

by Tom Pattinson
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Post virus spending


Whether it’s urgent medical supplies delivered to hospitals, or fresh vegetables needed for that evening’s dinner, the e-commerce market has continued to thrive during the pandemic. Quarantines and the closure of offline markets have enabled apps and platforms to reach new audiences who previously hadn’t used the technology. The early roll-out of new technologies has also accelerated timelines for some of the big players, as self-driving deliveries, self-service stores, and AI personalisation have all started to enter the market this month. But millions of people sitting at home with time on their hands is already leading to a spike in online sales of many daily items.


Obviously the demand for a vaccine and medicines as well as masks and domestic detergents have all increased significantly. Masks have sold out across much of China as well as hand sanitising gels. Drug companies usually come under price pressure from government departments, but the epidemic might reduce some of these pressures, allowing for larger stockpiles and further investment in research and development.

The Jenner Institute at the University of Oxford may well be one beneficiary of the virus. It has agreed to a contract with Advent Srl to produce the first batch of the novel coronavirus vaccine ChAdOx1 nCoV-19 for clinical testing. The vaccine ‘seed stock’ is currently being produced at the University’s Clinical Biomanufacturing Facility. This will be transferred to Advent, which will initially produce 1,000 doses for initial clinical trials.

RB (China), the company that produces Dettol disinfectants, has also been working hard to ensure its product can get to market when needed most. The company went through a complex procedure during the first weeks of 2020 to reopen its facilities in Jiangsu Province, including sending application letters to government organisations such as the Industry and Information Technology Bureau, Ministry of Commerce in Jiangsu and Yancheng Economic Zone, to allow the supplier’s factory to re-open in order to meet the huge demand for Dettol. After going through a number of approvals processes, the Dettol factory was re-opened on 18th February. The company also donated 50.6 million RMB in cash and antibacterial products to help stop the spread of respiratory infections in January.

Online entertainment

With so much free time but nowhere to go, people in China have taken to their phones and laptops for entertainment. The top 50 online games have seen a 100 percent spike in sales since 23 January. ‘Honor of Kings,’ a popular game in China that had sales of US $1.93 billion in 2018, reportedly hit a peak of $392 million in sales in a single day in January, with daily active users rising from around 65 million to 100 million in China. ByteDance, which owns the popular video-sharing site Douyin and TikTok, has seen its highest ever user numbers – and in turn, revenues.

Honor of Kings

Honor of Kings hit a peak of $392 million in sales in a single day


A number of tax incentives, discounted rates and rents are being offered by national and regional governments, meaning now could be a good time for investors. China will need foreign investment to boost GDP, and whilst talk of further government stimulus has not been confirmed, it is likely there will be incentives to invest in China during this period. There has already been a rise in demand for Testing Inspection and Certification (TIC) as companies – domestic and international – want to improve the quality of produce and consumer confidence by having certified products. The virus will further increase demand for independently inspected produce, allowing investors more confidence in buying into domestic Chinese companies when it comes to quality control and safety.

Sadly, many smaller businesses that may have a strong business model but have underfunded cash flow might be in distress, which provides opportunities for companies to negotiate investments or mergers and acquisitions to keep SMEs afloat.


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