Visitors go to the stand of Huahong Group at an exhibition in Shanghai, China, June 15, 2023. On August 7, 2023, Huahong Group, the world’s sixth largest foundry semiconductor producer, formally landed on the A-share science and know-how innovation board, and the opening value rose by greater than 13% on the primary day. (Photo by Costfoto/NurPhoto through Getty Images)
Costfoto | Nurphoto | Getty Images
Shares of Chinese chipmaker Hua Hong jumped 13% on the open throughout its market debut on Shanghai Stock Exchange’s Star Market on Monday, however rapidly gave up positive aspects.
Hua Hong is China’s second-largest chip foundry after Semiconductor Manufacturing International Corp. (SMIC). Hua Hong’s initial public offering is the largest one in Mainland China up to now this yr, based on EY’s international IPO report.
Shares of the chipmaker opened on the Nasdaq-style Star Market at 58.88 Chinese yuan, based on Refinitiv information. That’s a 13.2% jump from its provide value of 52 Chinese yuan ($7.23).
The Shanghai-listed shares have since pared positive aspects and have been buying and selling decrease at 53.99 Chinese yuan on Monday afternoon.
The firm, which produces semiconductors utilizing superior wafer course of applied sciences, beforehand stated that it’s going to promote 407.75 million shares at a value of 52 Chinese yuan per share, according to a filing. That represents 21.2 billion yuan ($2.95 billion) raised.
Chips produced by the Shanghai-based firm are used in industries spanning client electronics, communications, computing, industrial and automotive.
Hua Hong has been listed in the Hong Kong change since 2014. Its Hong Kong-listed shares plummeted as a lot as 7.4% on Monday.
Phelix Lee, fairness analyst at Morningstar Asia, stated the dimensions of Hua Hong’s IPO will not be vital.
“I do not assume it is a huge deal in the grand scheme of issues because the deal measurement is smaller than SMIC’s IPO 2 or 3 years in the past,” stated Lee. “The development of encouraging native chipmakers and different semi-related corporations to listing domestically is unbroken and we view there are extra semiconductor IPOs to return.”
SMIC raised 46.28 billion yuan ($6.62 billion) throughout its IPO in 2020.
Hua Hong’s itemizing comes as Chinese corporations search to boost capital to ramp up on superior chip tech as China seeks self reliance on superior chip tech amid Washington’s efforts to cut Beijing off from advanced chip tech.