The recent debut of Chinese EV manufacturer Seres on the Hong Kong stock exchange has sparked a wave of interest and controversy. A 3.7% slump in share prices on day one has left many investors questioning the future of this electric vehicle pioneer. But here's where it gets intriguing: Seres is just one of many mainland Chinese carmakers, including BYD, Nio, and Xpeng, turning to Hong Kong for funding amidst a booming IPO market.
Trading under the code 9927, Seres' shares took a hit, dropping to HK$126.60 by 10 am local time on Wednesday. This followed an earlier plunge of up to 10.3%. The initial price of HK$128.90 was set at the top of the marketed range, yet still represented a 22% discount compared to its Shanghai-listed shares. Despite the dip, Seres managed to raise an impressive HK$14.3 billion (US$1.8 billion) through its IPO.
The oversubscription of Seres' offer, at 132 times, is a testament to investor interest. Retail investors were allocated 10.86 million shares, accounting for approximately 10% of the total offering. This tranche attracted a substantial number of applications, with 57,928 accepted out of 202,300 valid submissions.
The international placement was also oversubscribed, at 8.61 times, with institutional investors securing 97.76 million shares, comprising the remaining 90% of the IPO.
Seres' cornerstone investors include prominent names such as Schroders, Mirae Asset Securities, Huatai Capital Investment, and Sanhua Intelligent Controls.
And this is the part most people miss: the story behind these numbers. Why did Seres' shares take a hit despite the high demand? Is it a sign of market skepticism towards electric vehicle makers, or a temporary blip in an otherwise promising journey? These questions are sure to spark debate among investors and industry experts alike.
What's your take on Seres' debut? Do you think it's a temporary setback or a sign of deeper issues? Feel free to share your thoughts and insights in the comments below!
