American companies were banned by the government recently from selling components to ZTE Corp of China for seven years. This was already a threat to the telecom equipment maker’s survival in the market. Now, the Chinese funds have slashed valuations of the company!

About 40 mutual fund managers in China came up with cutting down the ZTE Corp valuation of stock by 20% to 30% in the last weekend via a series of announcements. This comes right after ZTE suspended trading in mainland and Hong Kong shares on April 17.

GTJA Allianz and Huatai-PineBridege reduced their valuation of mainland shares of ZTE to 25.05 Yuan that’s 20% lower than last trading price. JT Asset Management slashed it to about 30% below the last close of 31.31 Yuan ($4.98).

Harvest Fund and HuaAn Fund went for about 20% cut below last trading price. These funds along with a few more have exposure to the Hong Kong shares of ZTE. The company had a market value of around $20 billion before the trading suspension.

It did not respond to request for comment on this matter. Yesterday, April 22, it revealed that it has been actively communicating with relevant parties to seek for a solution to the American ban. Earlier, the U.S. Commerce Department stated of its open-to-accept of more relevant evidence from ZTE.

The entire blow to the business of ZTE means a broad sell-off in technology shares. The sector is to suffer from the same as the investors fear. It is also possible that the U.S. would target other companies in the middle of already ascending trade tensions.

Display maker BOE Technology has its shares go down about 6% recently. It was reported that the company has been targeted for the ban, although the company said that it did not receive any official information regarding the sanction.

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