Joy Spreader Interactive Technology Ltd. fell as much as 6.3% Wednesday morning. If stocks close below their HK$2.88 offer price, it could be the very first Hong Kong IPO to drop on day one after raising significantly more than $100 million and having a oversubscription that is retail above 1,000, according to data published by Bloomberg. Joy Spreader sold HK$1.57 billion ($202 million) of stock, aided by the price toward the higher end of expectations.
The company’s IPO ended up being the third most sought-after in Hong Kong this by retail investors, with orders for more than 1,600 times the shares originally offered in the group year. Its slow performance is a contrast that is razor-sharp previous listings that saw similar popularity this year, including the 152% rise in July for Ocumension Therapeutics and 54% jump for Nongfu Spring Co. early in the day this month.
No price pop for Joy Spreader increases signs that sentiment in Hong Kong is cooling. The city’s equities market was falling of late amid escalated Sino-U.S. tensions and investors evidently saving cash for next month’s anticipated debut of Ant Group Co. Fulu Holdings Ltd., whose retail oversubscription rate additionally topped 1,000, rose 3.2% in its Sept. 18 debut while Yum China Holdings Inc. recorded the stock debut that is worst in more than the usual 12 months among billion-dollar listings in Hong Kong earlier this month.
“I think the IPO market has cooled down a bit and clients are turning more conservative,” said Alvin Cheung, associate director at Prudential Brokerage Ltd. “I think Joy Spreader’s performance reflects recent market belief.”
Joy Spreader had been backed by cornerstone investors Acuitas that is including Group LLC and Capital Investment LLC, a sign often seen by retail investors as a vote of self-confidence in a company.
New offerings have actually been particularly popular with Hong Kong retail investors this year, as ample liquidity encouraged banking institutions to lend and more technology organizations list in the city, spurred by restrictions imposed on some within the U.S. Seven of the 10 IPO debuts which can be best in Hong Kong in the past decade took place this year, based on deals that raised more than $100 million, according to data, and Joy Spreader Interactive Technology Ltd. fell as much as 6.3% Wednesday.