Mixed gray market turnout for debutante Chinese firms ahead of IPO

Three Chinese firms set to debut on Hong Kong’s stock exchange on Tuesday showed mixed performances in gray market trading ahead of their initial public offerings.

Rongta Technology (Xiamen) Group, a provider of automatic identification and data capture devices, saw its shares surge between 74 and 78 percent across three major retail gray markets. The company priced its shares at the bottom end of the range at HK$10, while gray market quotes fluctuated between HK$17.40 and HK$17.80. Based on a board lot of 500 shares, retail investors could see paper gains of HK$3,700 to HK$3,900.

Artificial sweetener maker Newtrend Technology also posted strong gains, rising over 50 percent in gray market trading. At the most active gray market venue, Phillip Securities, shares opened at HK$21.90 and climbed further to HK$29.10, representing a 54 percent premium over the company’s bottom-end offer price of HK$18.90. Shares investors allocated from Newtrend’s placement stood to gain about HK$2,040 per board lot of 200 shares.

In contrast, bus tracking app provider MetaLight’s shares fell between 8 and 13 percent in gray market trading, resulting in a paper loss of at least HK$300 per board lot of 400 shares.

STAFF REPORTER