Shares of Shanghai Electric Group Co., Ltd. (HKG:02727) plummeted over 9% on Wednesday, following the company's release of disappointing third-quarter earnings results.

According to a Hong Kong Stock Exchange filing, Shanghai Electric's net profit attributable to shareholders stood at 156.6 million yuan ($21.9 million) in the third quarter, representing a sharp 32% decline from the same period last year. This significant drop in profitability came despite a 5.7% year-over-year increase in revenue to 26.5 billion yuan ($3.7 billion).

The divergence between the company's top-line growth and bottom-line decline appears to have caught investors off guard, leading to the substantial sell-off in SH ELECTRIC's shares. The broader market reaction suggests that the power generation and electrical equipment manufacturer's financial performance fell well short of market expectations, potentially signaling cost pressures or other issues impacting profit margins.