Runaway Denway slips into reverse

DENWAY Investment, the mainland car company, fell 6.8 per cent to become the worst-performing stock on the exchange yesterday as speculators found no-one wanting to buy the shares for which they had fought so hard.

Consistent selling pressure pulled the share price down to $2.05, a fall of 15 cents, with dealers saying many shareholders were keen to sell but unable to get the price they wanted.

Trade volume was the day's seventh highest at $75.9 million. The warrants also fell, by 10 cents to $1.11.

Yesterday was the company's second day on the exchange, and the poor performance was in marked contrast to the frenzy of two weeks ago, when Denway shares were in more demand than any share in Hongkong's history.

The one-for-five bonus warrants fell nine per cent, leaving investors with a package price of $2.232, an 86 per cent return on the subscription price of $1.22, but only a slim return for punters who borrowed $1 million from a mainstream financial institution to stag the issue, and had lending costs of around 80 cents a share.

Mr Adrian Ngan Wai-hung, assistant director at Vickers Ballas, said trade was ''quite disappointing'' and could help cool down speculation on public listings, particularly China concept stocks.

''Denway has a lot of concept but there is no buying after the listing,'' Mr Ngan said.

There was little sign of institutions moving into the market to buy the stock from speculators, on a day when prices were marked slightly down.

Investment manager of Thornton Management (Asia), Mr Christopher Day, said that with new listings ''institutions like to sit back and see what the share price does.'' Before listing, the shares traded as high as $3 on the grey market and the frenzied demand for Denway shares has prompted a government investigation.