Consumer electronics maker Nam Tai Electronic & Electrical Products closed below its initial public offering price on its first day of trade yesterday, hit by weaker market sentiment and cooling interest in stock launches.
The shares closed at $3.40 - 12.37 per cent lower than its $3.88 IPO price which was fixed in the middle of its $3.55 to $4.20 indicative range.
Selling pressure from retail and institutional investors was strong amid uncertain near-term market conditions and a waning interest in IPOs, one broker said.
'Particularly as this is an offer of existing shares from its parent,' the broker added.
Nam Tai E&E is a spin-off unit from New York-listed parent Nam Tai Electronics. The parent offered 200 million existing shares in the subsidiary to investors.
'Institutional investors rushed to dump the shares to cut losses when the share price touched $3.55 - the low end of the IPO's pricing guidance,' the broker said.
Another broker noted HSBC Holdings, the sponsor of the IPO, had bought Nam Tai E&E shares as a stabilisation move when they traded between $3.225 and $3.70.