Bubble Tea Chain Nayuki Slides 14% in Hong Kong Debut

(Bloomberg) -- Chinese bubble tea chain Nayuki Holdings Ltd. fell on its Hong Kong trading debut Wednesday despite a well-received share sale.

Shares of the teahouse operator opened at HK$18.86 and dropped further to end the day at HK$17.12. That’s down about 14% from its top-of-the range offering price of HK$19.8 per share. The IPO raised $656 million and the retail portion was 432 times subscribed. Institutional books closed a day earlier than scheduled due to demand.

Meanwhile, Hutchmed China Ltd., a cancer drug developer backed by billionaire Li Ka-shing, jumped 50% in its debut Wednesday, after raising $537 million from a relatively lukewarm share sale.

The fluctuations illustrate that investors are getting pickier while more firms are tapping the Asian financial hub’s once-again active IPO market. At least 9 deals have been priced this month, compared to only two in April and four in May, according to data compiled by Bloomberg.

Bankers in Asia expect stock listing aspirants to likely face a less generous market following a first-half sales boom, as bubbly valuations and nervousness about U.S. monetary policy make investors more cautious.

Firms in Asia have raised $82 billion through initial public offerings so far this year, the most ever for a first half, and beating the previous record of $63 billion seen during a comparable period in 2010, data compiled by Bloomberg show.

Angelalign Technology Inc., a maker of clear orthodontic braces, more than doubled on its debut earlier this month, becoming one of this year’s most popular offerings in the city. Meanwhile, China Youran Dairy Group Ltd. fell 12% on its debut.

Next up, investors will be looking at New-York traded Chinese electric-vehicle maker Xpeng Inc., which is said to raise $1.8 billion in a dual primary listing.

Nayuki plans to use proceeds from the offering to expand its teahouse network, deepen market penetration and strengthen its supply chain, according to its listing prospectus. It had 491 flagship Nayuki outlets at the end of last year, including 489 in mainland China and one each in Hong Kong and Japan.

The Shenzhen-based firm sells fresh-fruit teas, cold-brew beverages and baked goods. It recorded losses of 203 million yuan in 2020 and 40 million yuan in the previous year, according to its prospectus. Revenue rose 22% year-on-year to 3.1 billion yuan.

JPMorgan Chase & Co., CMB International Capital Ltd. and Huatai International Ltd. are joint sponsors for the listing.

©2021 Bloomberg L.P.