SHARES of China's Chengdu Telecommunications Cable Co (CDC) lost 13.4 per cent in maiden trading yesterday, dragged by the stock's expensive pricing and concern over China's worrying economic outlook. CDC ended at $2.425, down 37.5 cents from its issue price of $2.80, but recouped losses from its session low of $2.325. As the second most active counter, about 14 million shares changing hands. It might be too easy to blame the plunging stock market for the counter's debut failure, but the tumble came as the Hang Seng Index rebounded yesterday on the back of the overnight strength on Wall Street. Even the Hang Seng China Enterprises Index, which tracks the trading of H shares, rose 1.82 per cent yesterday. 'The stock's performance was mainly due to its higher price-earnings multiple,' said an analyst at James Capel Research. She said the average H-share sector was trading at about 10 times next year's earnings after the latest market crash. CDC sold its shares at a 1994 multiple of 13.1 times on a fully diluted basis. It will trade at 11.5 times next year's estimated profits on the issue price, according to its sponsor, Credit Lyonnais Securities. After yesterday's decline, the stock fell to a 1995 multiple of about 10 times. She said investors had tended to be more cautious in the lead-up to the end of the year because they were looking at what would happen in China next year. Sun Hung Kai Research analyst Chris Fung expected CDC's shares to rebound mildly in ensuing sessions, after digesting loss-cutting orders yesterday. He cautioned that the future profit growth of CDC would be hampered by a possible write-off for value-added tax (VAT) recoverables, which amounted to 33 million yuan (about HK$30 million). The VAT rebates were given to the company's opening inventory as a result of China's change in taxation policy in January. But, if the company cannot offset its VAT payable with the rebates, the sum will be written off against its profit and loss account.