JD.com shares to jump on ‘back’ debut in Hong Kong

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Chinese e-commerce group JD.com surged nearly 6 percent on the debut stock market in Hong Kong after increasing it by nearly US $ 4 billion in the second largest sales share in the world this year.

The group group’s online sales gained as much as 5.8 percent at the start of the session Thursday, reaching HK $ 239 ($ 30.84) per share.

JD.com raised $ 3.9 billion earlier this month in the secondary sale of 133 million euros in new shares at an offer price of HK $ 226 each. The value of the fundraiser could increase to $ 4.3 billion if bankers run a so-called “greenshoe” to increase the deal size.

Hong Kong is likely to benefit from a wave of large equity from barns this year, as US listed Chinese companies, New York trader face pressure regulating the Trump administration and the prospect of forced delistings.

JD.com is trading on the Nasdaq, but the group is one of several large Chinese companies on the brink of a so-called “reunion” listing in Hong Kong.

NetEase, another Chinese internet user, recently raised about $ 2.7 billion in a Hong Kong secondary investment.

In its preliminary prospectus for the Hong Kong listing, JD.com highlighted a potential risk of a bill being pushed by the US Congress which threatens to strike out for foreign companies that fail to provide a access to audit reports.

People familiar with JD.com’s secondary investment, expressed interest in US investors, were unaffected by Washington’s offensive sentiment.

“The demand from the US investor is just huge, I don’t see the difference from any other popular offer,” said one person, adding that the institutional side of the deal was “far superior”.

Demand for JD.com stocks from Hong Kong investors has been robust, with retail offering 179 times oversubscribed.

JD.com founder Richard Liu was absent from the ceremony list in Beijing, where Xu Lei, the company’s retail chief business unit, ranked a big gong at the start of trading.

Mr. Xu declined to say whether the deterioration of US-China relations and increased regulatory bodies have played a role in the Hong Kong flush of listing.

“We are more focused on the composition of investors – [Asian investors] better understand China’s economy, China’s market and Chinese businesses, “he said. “Like anything else, I can’t comment.”

Mr. Xu in the past few months has replaced Mr. Liu in the corporate filings of many JD.com’s Chinese affiliates.

The Hong Kong equity sale represents about 4.3% of JD.com’s total outstanding stock before the over-allotment option. Stocks were up about 3.8% at noon.

Bank of America, UBS and Citic Securities are co-organizers of the list.

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