Apple supplier Luxshare leads lukewarm IPOs in Hong Kong as investors get picky

Shares of Luxshare Precision Industry led losses among IPO debutants in Hong Kong on Thursday after raising HK$24.27 billion ($3.10 billion) in the city’s biggest listing this year, as investors became more selective amid a fundraising rush and rising volatility.

The stock dropped as much as 9.6% to a low of HK$57.2 compared with ‌its offer price ⁠of HK$63.28. ⁠At market close, it last traded at HK$60 a share.

Luxshare’s debut is the latest in a line of share offerings by Chinese technology and advanced manufacturing firms in Hong Kong, as they seek to fund expansion and research in electronics, chips and artificial intelligence.

Knowledge Atlas Technology, also known as Zhipu AI, launched a roughly $4 billion Hong Kong share placement on Wednesday with shares climbing another 11.3% on Thursday, while chipmaker Nexchip Semiconductor priced its Hong Kong listing this week to raise about HK$6.98 billion.

However, these offerings have run into a volatile market driven by a tech-stock pullback and renewed geopolitical tensions. A record wave of lock-up expirations ⁠after a ‌strong first half for new listings is also casting a shadow.

Most of the six other Hong Kong debutants also received lukewarm welcomes on Thursday. Electronic test equipment maker Rigol and circuit-board tool maker DTech slid below their offering ⁠prices, while e-paper display maker DKE and ceramic electronic parts maker CCTC notched small gains.

Food company Qiyunshan Food surged nearly threefold to a high of HK$26 per share, while Rokae Robotics was up 15.2%.

“The underperformance of some new listings likely reflects a more cautious market backdrop and broader uncertainties surrounding global trade and geopolitics,” said Chokwai Lee, a director at Morningstar.

The weak debuts show investors are growing more selective about richly valued companies, as well as a more cautious stance on the pace of AI adoption following a recent pullback in the chip rally, he added.

Chinese tech firms which listed in droves months ago are faced with investor profit-taking starting this month. MiniMax Group plunged as ‌much as 18% on Thursday as the company’s first large post-listing lock-up period expired, freeing up roughly 45% of its issued share capital for public trading.