Bubble tea firm fizzles on debut

Reuters and staff reporter

China bubble tea chain Guming (1364), which is also known as GoodMe, closed over 6 percent lower than its offer price after dipping as much as 10 percent on its trading debut in Hong Kong, becoming another beverage stock that closed below offering price on the first trading day.

The company sold 182.4 million shares at HK$9.94 each, the top of the price range indicated to investors when the deal launched last week.

Guming stock began trading at HK$10 but fell as much as 10.2 percent to HK$8.93. The stock closed at HK$9.3, still down 6.4 percent from the offer price of HK$9.94, giving a paper loss of HK$256 on per board lot of 400 shares,

In 2021, Nayuki (2150) closed 13.5 percent lower than its offer price of HK$19.8 after once dropping as much as 15 percent, giving a paper loss of HK$1,340.

After that, the company's founder published a letter through the tea chain's official WeChat account and explained the initial public offering is "just a small milestone in Nayuki's growth."

Nayuki's shares dropped 5.1 percent this year and slumped over 88 percent since its trading debut.

Another mainland beverage stock Sichuan Baicha Baidao (2555) closed 26.9 percent lower than its offer price on its debut in April 2024.

Its shares lost 9.82 percent this year and 4.3 percent since its debut.

Amid the shadow over future bubble tea listings in the city, China's largest bubble tea firm, Mixue Group, will begin book-building for an IPO by the end of this month to raise about US$500 million (HK$3.9 billion), according to Reuters.