Hygon Information Technology Co., a Chinese IT business, had a fantastic listing on the Shanghai Stock Exchange’s STAR Market as its share value surged by about 100% during the first trading session.
In 2014, the Beijing-based Hygon Information Technology Co. was established with the goal of developing, manufacturing, and distributing different computer parts and components. A central processing unit (CPU), a drive control unit (DCU), and high processing chips were a few of the components. On stock markets, around 300 million shares of the corporation were offered for sale.
The value of the stock increased by 105% as a result of the trading of shares, which began at 36 yuan a share and reached a high of 73.8 yuan during the day.
Hygon Information Technology Co Limited raised over 1.6 billion dollars in a single day, ranking second among all stock price increases on the opening day on the STAR Market. A company called Jinko Solar, which makes solar panels and is located in Shanghai, holds the top spot for the first-day session’s biggest increase.
Jinko Solar, which was launched on the STAR Market in 2022, had a rise in the value of its shares of 111 percent, raising 1.5 billion dollars in a single trading day.
The third-largest listing this year was carried out by the Beijing-based business in Asia, where huge offers are thriving despite a decline in conventional IPO venues. Since capital constraints make it difficult for foreign investors to participate, mainland China IPOs primarily target local investors and frequently burst once trading starts.
For the first five trading sessions, there will be no price cap on the shares. As of 10:23 a.m. local time, it had reduced gains to 80% and was on track to have the second-best first day pop among Chinese debuts worth more than $1 billion this year.
According to statistics gathered by Bloomberg, around 80% of launches on mainland China bourses of offers that raised at least $500 million finished their first day in the green.
The share offer by Hygon Information Technology benefited from robust investor and fund demand, with tranches set aside for ordinary investors being oversubscribed by more than 2,500 times.
According to a business document, the issue price equates to a 315.2 times price-to-earnings ratio as of the end of 2021. That contrasts with a 27.7 times industry standard.
According to the prospectus for the sale, the US Department of Commerce added Hygon Information Technology to a list in June 2019 that necessitates US businesses to request government clearance before supplying products or services to such organisations.
According to a statement to Shanghai’s exchange, the funds would be used for, among other things, research and development and a reserve fund for technological development.
The IPO of Hygon Information Technology is being sponsored by CITIC Securities Co.