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SenseTime rises 7 per cent in Hong Kong debut after surprise surge as traders defied US sanctions
- The US$851 million global offering was delayed by the US decision to sanction the AI group for alleged human rights abuses
- Stock surged to as high as HK$4.74, versus the indicative price range of HK$3.83 to HK$3.90 in grey-market trading
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SenseTime Group, China’s artificial intelligence champion, jumped more than expected on its trading debut, paying off for investors who shrugged off concerns about US sanctions in the run-up to its US$851 million stock offering.
The stock jumped as much as 23 per cent to HK$4.74 in Hong Kong from its initial public offering (IPO) price of HK$3.85. That compared with a range of HK$3.83 to HK$3.90 indicated in pre-trading action late Wednesday. It closed at HK$4.13, a 7.3 per cent premium, valuing the group at HK$138 billion (US$17 billion).
Controversy has dogged the group’s listing plan for more than a year amid heightened geopolitical risks, prompting it to downsize the IPO from as big as US$2 billion, according to reports. The US blacklisted SenseTime in early December for alleged human rights abuses in the far-west Xinjiang region, forcing a relaunch with an amended prospectus and the exclusion of US investors.
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The company has rejected those allegations as unfounded, describing the US move as a fundamental misperception.
01:22
US blacklists 28 Chinese entities over Xinjiang
US blacklists 28 Chinese entities over Xinjiang
The US Commerce Department had placed SenseTime on its Entity List in 2019 alongside more than 20 other Chinese firms because of its alleged role in Xinjiang. Companies on the blacklist are prohibited from doing business with American companies without a licence.
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