By Yi Wei Wong

Shares of Shanghai-based food supplier Tingyi (Cayman Islands) Holding Corp. clawed back some of the losses made in morning trade Wednesday.

A consumer-rights television show exposed poor hygiene standards at food-processing companies that said they supply Tingyi and others, sending shares down by as much as 16% to an intraday low of 11.70 Hong Kong dollars.

Tingyi terminated its supply agreement with a supplier that was identified on the show, and it has started to recall all affected products, it said via email. Shares were last down 1.9% at HK$13.60.

Earlier in the day, Tingyi said on its website that the company supplied it with raw materials used in pickle packs for a certain brand of instant noodles; it apologized for the oversight and said it has set up an internal committee to investigate the matter.

Jefferies maintained its buy rating on the company and its target price of HK$13.86, noting that the noodles Tingyi mentioned are a low-margin product and account for just around 4% of sales.

"We do not think this will affect demand for their other flavors," the investment bank said in a research note, referring to Tingyi and another affected company, Uni-President China Holdings Ltd. "It is likely, however, that both companies will invest in further brand-building, thereby incurring additional marketing expenses."


Write to Yi Wei Wong at yiwei.wong@wsj.com


(END) Dow Jones Newswires

03-16-22 0332ET