HONG KONG—China confirmed it would take drastic steps to restrain the country’s booming after-school tutoring industry, prompting further selloffs in stocks such as New Oriental Education & Technology Group Inc.
The restrictions, published over the weekend by state media,are the most recent regulatory assault on a fast-growing part of the Chinese economy. They follow a monthslong crackdown on various aspects of China’s technology industry that has rattled companies such as Alibaba Group Holding Ltd.
, its unlisted sister company Ant Group Co., and ride-hailing giant Didi Global Inc
New Oriental’s Hong Kong-listed shares, which had lost more than two-fifths of their value on Friday, crashed by an additional 37.5% on Monday morning in the city, giving the company a market value of about $4.2 billion, according to FactSet. The company, whose primary listing is in the U.S., has lost nearly $30 billion of market capitalization since its shares peaked in mid-February.
Investors have grown more worried about the industry’s prospects, as Beijing moves to tackle the spiraling educational costs that have helped deter many families from having more children.