INVESTORS on the Chinese mainland boosted their stakes in beaten-down Tencent Holdings Ltd. and Meituan to the highest level in more than seven months, drawn by attractive valuations and easing concerns over regulatory moves.

Mainland investors net purchased about 30 million Tencent shares so far this year via trading links between the mainland and Hong Kong, lifting their combined ownership to the highest level since June, according to calculations of exchange data as of Monday. That’s near a record set earlier in 2021.

A similar trend occurred in delivery giant Meituan, with the traders adding more than 56 million shares this year, the data show.

“Mainland investor sentiment on big tech may be turning as Tencent, Meituan and Kuaishou led a normalization in southbound flows to start 2022,” Marvin Chen, an analyst at Bloomberg Intelligence, wrote in a note.

Tencent and Meituan were among the stocks dumped most by mainland traders last year. Tencent’s online-game business was squeezed by new limits on the number of hours children could play. Meanwhile, Meituan saw costs rise as the government revised rules to boost the welfare of delivery workers.

The renewed buying interest could signal a reversal of fortunes for these firms following the year-long selloff. It also comes as a number of Wall Street firms and brokers turn more positive toward China tech firms after the steep share declines. (SD-Agencies)