Chinese food delivery stocks surged Monday after regulators launched a competition investigation to curb aggressive price wars. The State Administration for Market Regulation announced the probe Friday, targeting excessive subsidies and predatory pricing that have devastated profitability across the sector. Shares of Meituan jumped 8%, while Alibaba's Ele.me platform saw gains over 5%. JD.com also climbed 3%.

The move follows months of intense rivalry as tech giants poured cash into food delivery and instant retail services to defend market share. Both Meituan and Alibaba welcomed the investigation, pledging cooperation with officials. Regulators specifically criticized 'involution-style' competition—a term describing companies undercutting each other into a race to the bottom.

This crackdown signals Beijing's intent to restore order to a sector that has become a race for dominance at any cost. Investors now watch for new rules that could reshape the competitive landscape and boost long-term margins.