Zhongji Innolight sees rocky start as shares fall on Hong Kong IPO amid global AI sell-off
The Chinese firm completed Hong Kong’s biggest IPO of the year, but its debut comes amid waning investor confidence in AI-related stocks
Zhongji Innolight suffered a rocky start in its highly anticipated Hong Kong stock market debut on Thursday, as the Chinese firm felt the impact of a global downturn in investor sentiment towards the artificial intelligence sector.
Shares closed two per cent lower at HK$960 after dropping as much as 10 per cent. The company’s Shenzhen-listed shares slipped 9.15 per cent to 864 yuan, narrowing their discount on the Hong Kong stock market to about four per cent.
The Chinese firm – a leading producer of optical transceivers used in AI data centres – had earlier completed Hong Kong’s biggest initial public offering of the year, raising HK$53.4 billion (US$6.8 billion) at a market capitalisation of over HK$1 trillion.
“Suzhou’s complete optical communications chain and open innovation ecosystem have supported our ongoing growth,” said Liu Sheng, the company’s chairman, during a speech at the listing ceremony. Its core optical transceiver business operations are based in Suzhou, Jiangsu province.
But the listing has coincided with a global sell-off of AI-related stocks, with Innolight pricing the IPO at HK$980 per share – below its upper marketing limit of HK$1,010.
Innolight’s international offering was oversubscribed nearly nine times, while its public offer attracted over 62,000 retail applicants, resulting in an oversubscription of nearly 16 times.
The company’s share price in Shenzhen had slumped 16 per cent since the launch of its H-share public offering as of Wednesday, closing at 951 yuan per share. That narrowed the discount between its new H shares and existing A shares from 20 per cent to just 11 per cent.