China's Tuhu Car shares unchanged from issue price in Hong Kong debut (updated)

TUHU Car

26/09/2023 02:48

(Adds details of IPO, investor subscription rates and Hong Kong
IPO volume year to date)
    By Scott Murdoch and Donny Kwok
       SYDNEY, Sept 26 (Reuters) - Tuhu Car's  9690.HK  shares
opened unchanged from their HK$28 ($3.58) issue price as the
Chinese car maintenance firm started trading on the Hong Kong
Stock Exchange on Tuesday.
    The company raised $152 million in its initial public
offering by pricing its shares at the low end of the range
flagged to investors last week.
    The firm sold 42.44 million shares in the IPO after an
adjustment option was exercised to increase the size of the deal
from its original 40.61 million shares.
    Tuhu set the price of its shares at the low end of the HK$28
to HK$31 range that was flagged to investors when the deal was
launched.
    It was the first of three IPOs last week to price at the low
end of the range, followed by AI startup Beijing Fourth Paradigm
 6682.HK  and hospital cloud software firm Neusoft Xikang
 9686.HK , indicating demand for new share sales remains weak.
    The international tranche of Tuhu's IPO was 2.3 times
oversubscribed, the company said on Monday, while retail demand
was 2.67 times the number of shares on offer.
    Those oversubscription rates are considered low compared to
Hong Kong's IPOs which could be more than 1,000 times covered by
the city's army of retail investors keen to cash in on quick
returns.
    There has been less than $3 billion worth of IPOs in Hong
Kong in the first nine months of 2023, according to London Stock
Exchange Group data, compared to $4 billion at the same time
last year.
    Higher global interest rates and tough new rules put in
place by Chinese authorities on their companies wanting to list
on overseas exchanges has been blamed by analysts for the
persistently weak IPO market in Hong Kong.
($1 = 7.8187 Hong Kong dollars)

 (Reporting by Scott Murdoch in Sydney and Donny Kwok in Hong
Kong; Editing by Tom Hogue and Muralikumar Anantharaman)
 ((Scott.Murdoch@thomsonreuters.com;))