(Yicai Global) June 10 -- Wangfujing Group's stock price surged to an eight-year high today after the struggling operator of Beijing's first department store said that it has become the No. 8 company to be allowed to engage in duty-free business in China.

Wangfujing shares [SHA:600859] jumped by the daily limit of 10 percent to CNY30.12 (USD4.26) this morning, the highest intraday price since December 2011. The equity price has more than doubled from the end of April.

The Ministry of Finance gave Wangfujing the permit, the capital city-based operator of the Beijing Department Store said in a statement yesterday.

Chinese regulators haven't granted new duty-free business licenses for many years. Some of the successful applicants include Hainan Duty-Free and Zhuhai Duty Free Enterprises Group.

Tax-free retail could spur new growth in the global sector that is dealing with the devastating impact of the Covid-19 pandemic. By 2028, China's domestic duty-free market is expected to reach USD3 billion, with an annual compound growth rate of 18 percent, according to an analyst at Southwest Securities. Domestic sales channels could reach 35 percent of the total.

In the first quarter, Wangfujing reported a CNY202 million (USD28.6 million) net loss after being profitable a year earlier as its 48 outlets were closed during the Covid-19 epidemic. After the stores reopened, their business hours were narrowed with a reducing number of visitors.

Founded in 1955, Wangfujing counts Beijing Tourism Group as its controlling shareholder.

Editor: Emmi Laine