Shares of Tencent Music Entertainment Group started its Hong Kong debut on a pretty high note, following a listing that saw no new shares or funds being sold or raised.
The stock of the Chinese music-streaming platform rose 1.2% to HK$18.22 ($2.32) on Wednesday after trading at HK$18 in the city’s exchange at the open.
Nanshan, Shenzhen-based Tencent Music, stated that one of its US-listed shares was equivalent to two Hong Kong shares. The starting price was muted compared to the company’s US shares which ended at $4.58 on Tuesday’s session in New York.
So far, Tencent Music’s stock in the US has shed 33.1% this year as investors lose their confidence in Chinese tech stocks amid a regulatory crackdown on the sector.
The Hang Seng index fell 1.5% on Wednesday, while the tech index last stood 1.5% lower.
Tencent Music became the latest in a group of US-listed Chinese companies to make another listing in Hong Kong to minimize the risk of being pulled out from the country’s exchanges due to Washington’s auditing issue with Beijing.
Both parties recently reached an agreement allowing US officials to audit Chinese firms listed in New York, signaling a potential end to the two sides’ long-drawn-out dispute.
The music-streaming platform in the previous week announced its plans to trade in Hong Kong through listing by introduction, which involved no new shares or capital being issued or raised during the process.
Such a method of going public has become popular in Hong Kong this year, following the US’s warning of delisting Chinese companies and the city’s difficulty with raising fresh funds at ideal prices due to market turmoil.
Chinese electric-vehicle maker NIO Inc., real-estate services company KE Holdings Inc., and fintech group OneConnect Financial Technology Co. Ltd. are some of the firms that listed by introduction this year.
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