Update | Tencent’s China Literature most-profitable IPO debut in a decade after value soars as much as 100pc
Stock price ends the day at HK$102.4, 86pc up from its IPO price of HK$55; 143m shares change hands, worth a total HK$14b, giving it a market cap of HK$93b
Shares in China Literature, Tencent Holdings’ online publishing arm and mainland China’s largest online publishing and e-book website, skyrocketed nearly 90 per cent in value by the close on Wednesday, after initially jumping 64 per cent immediately in early trading in Hong Kong, in what’s been dubbed the city’s hottest IPO in nearly a decade.
The surge gave retail investors who won the bid for new shares a first-day profit of HK$9,480 per lot in book value – the highest among the main board’s IPO debuts since November 2007, when Alibaba.com posted a first-day profit record of HK$13,000 per lot after soaring 192 per cent.
China Literature’s lot size contains 200 shares.
China Literature closed at HK$102.4, giving it a market capitalisation of HK$93 billion, after touching a daily high of HK$110 earlier in the morning, doubling its IPO price of HK$55 (US$8.29). 143 million shares changed hands during the day, worth a total HK$14 billion.
The company’s market cap has already overtaken 11 of the 50 constituent stocks in Hong Kong’s benchmark Hang Seng Index, surpassing Cathay Pacific, Hang Lung Properties, Kun Lun Energy, and Lenovo Group, among others, according to data compiled by Et Net, a financial information provider.
The shares had closed more than 60 per cent above their IPO price in the so-called grey market – when new securities are bought and sold before official trading begins – ahead of what market watchers had already anticipated would be a blockbuster debut. The retail portion gathered demand 626 times the number of shares on offer.