China Renaissance sinks 22% in Hong Kong debut

HONG KONG: Investment bank China Renaissance plunged as much as 24% on debut in Hong Kong yesterday, becoming the latest high profile Chinese listing in the city that investors have soured on.

China Renaissance, which has advised on some of the country’s biggest technology deals and is led by famed rainmaker Bao Fan, was hurt by the stock market performance of some recent large initial public offerings (IPOs) which signalled trouble for that line of its business, some analysts said.

It fell to a low of HK$24.15 (US$3.09) after opening at the IPO price of HK$31.80. The shares closed down 22.3% yesterday.

Hong Kong IPOs have performed poorly this year, buffeted in part by market jitters over a worsening Sino-US trade war.

Chinese online food delivery-to-ticketing services firm Meituan Dianping gained 5% on its debut last week but is now trading below its IPO price, while hotpot chain Haidilao, which began trading on Wednesday, also dropped below its issue price yesterday.

Ample Finance Group director Alex Wong said the weak performance of those two IPOs had weighed on China Renaissance, as its business depends in part on IPO performance.

“The most attractive part is to invest in those new economy companies and then get them listed later on, so if the sentiment is like this then you would doubt whether they could replicate their success of the past,” he said.