Glorious Property Holdings Ltd (恒盛地產控股) fell as much as 20 percent on its first day of trading in Hong Kong, the fifth straight debut slump for an initial public offering (IPO) in the city.
The stock dropped 15 percent to HK$3.76 at the 4pm close of trading. Glorious Property last week raised HK$9.9 billion (US$1.28 billion) in the largest Hong Kong IPO by a Chinese property company in two years.
The developer joins four other companies, including China South City Holdings Ltd (華南城控股), in falling on the first day in the past two weeks. The declines have heightened investors’ concern the market’s appetite for offerings is waning as Wynn Macau Ltd (永利澳門公司) prepares to start trading on Oct. 9 after raising US$1.63 billion.
“It’s a massacre,” Francis Lun (藺常念), general manager at Hong Kong-based brokerage Fulbright Securities Ltd (富昌證券), said in an interview. “Right now investors have lost all confidence in new shares and I can’t see this changing in the near term.”
Hong Kong’s Hang Seng Index, which has rallied 80 percent from a four-month low on March 9, fell 3.1 percent this week, the biggest drop since the five days ended Aug. 21.
Wilmar International Ltd (豐益國際), the world’s biggest palm oil trader, said on Wednesday it had not decided on the timing of a Hong Kong share sale of its China assets and was monitoring market conditions. Wilmar is delaying the Hong Kong sale to the middle of this month or later from Monday initially, FinanceAsia reported on its Web site on Wednesday.
“The next IPOs will probably have to be priced more attractively,” said Andrew Sullivan, a sales trader at Mainfirst Securities Hong Kong Ltd.
China South City, a developer of logistics centers, tumbled as much as 30 percent on its Hong Kong debut on Wednesday. China Lilang Ltd (中國利郎), owner of the nation’s biggest men’s clothing brand, dropped as much as 6.9 percent and Peak Sport Products Co (匹克體育用品) declined as much as 18 percent over their first day.
Metallurgical Corporation of China Ltd (中國冶金科工), which helped build Beijing’s “Bird’s Nest” stadium, fell as much as 15 percent on its trading debut last Thursday before closing down 12 percent.
Companies including Wynn Macau and Yingde Gases Group Co (盈德氣體集團), China’s largest independent onsite supplier of industrial gases, will start trading on the Hong Kong exchange next week, according to Bloomberg data.
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