(Nov 10): Jiangsu Xinde Semiconductor Technology Co’s shares surged in their Hong Kong debut while Suzhou Denglin Technology Co’s stock slumped on their first day after the Chinese chip suppliers raised a combined US$301 million (RM1.22 billion) in their initial public offerings, entering the market at a time of extreme volatility, especially for technology stocks.
Chip assembly and testing company Xinde Semi’s shares rose 28.3% Tuesday (Nov 10) after the company priced 106.6 million shares at HK$8.88 each, below the maximum, to raise HK$946 million (RM489.12 million). Meanwhile, Denglin’s shares fell as 7.8% after the graphics processing unit maker priced 6.1 million shares at HK$231 apiece, the low end of the marketed range, to raise HK$1.41 billion.
Technology stocks have been through bouts of volatility recently, buffeted by doubts over the artificial intelligence buildout and the impact of the US midterm election. On Monday, Asian equity markets rebounded after last week’s steep declines, even after Nvidia Corp's board revealed an investigation into whether CEO Jensen Huang had been targeted in a foreign espionage plot.
The debuts are an important bellwether for new listings in Hong Kong. First-time share sales in the city have raised US$51.9 billion this year, approaching the 2010 record of US$57.8 billion, according to data compiled by Bloomberg, largely driven by Chinese technology companies. But the flow has started to slow as issuers and investors grow increasingly cautious, with the AI trade wobbling and regulators intensifying scrutiny of deals.
In a sign of the resilience of investor demand, RelyEZ Energy Storage Technology Co shares soared as much as 129% after the Chinese energy storage system provider raised HK$562.7 million, with the retail tranche 1,389 times subscribed.
Successful debuts could pave the way for a busy year-end after only three IPOs were completed in October, versus an average of about 13 a month from January through September, data compiled by Bloomberg show.
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