Shares of KINGBOARD HLDG (00148) tumbled more than 11% in the afternoon session.

At the time of writing, the stock was down 10.99% to HK$75.3, with a turnover of HK$3.606 billion.

The decline follows news that Hallgain Management Limited, a vehicle controlled by the family of major shareholder Cheung Kwok Wing, has further reduced its stake in the company.

Data from the Hong Kong Stock Exchange shows that Hallgain Management sold 9.127 million, 7.56 million, and 9.328 million shares of KINGBOARD HLDG over three trading days from July 2 to July 6, involving approximately HK$2.56 billion.

This selling activity lowered its shareholding from 34.3% to 31.98%.

According to analysis, Hallgain's stake has now been reduced by a cumulative 12.5% from its peak of 44.5% in April, with the net reduction for the year to date reaching 11.78%.

It has been noted that KINGBOARD HLDG's first-half performance could potentially exceed forecasts, partly due to the average selling price for electronic-grade fiberglass cloth possibly being higher than expected.

However, should major shareholder Hallgain continue to reduce its stake in KINGBOARD HLDG to 30%, it may cap the stock's near-term upside potential.