Chinese Circuit-Board Firm Dongshan Precision Plunges 6% in Hong Kong Debut

Shares of Suzhou Dongshan Precision Manufacturing fell as much as 6 per cent after the circuit-board manufacturer began trading in Hong Kong, before the decline eased to 4.6 per cent at 9.45am.

The movement came as investor sentiment was haunted by a deepening sell-off across China’s artificial intelligence (AI) and tech hardware sectors.

The company’s Hong Kong debut followed an underwhelming HK$9.9 billion (US$1.26 billion) initial public offering (IPO).

Suzhou Dongshan Precision Manufacturing was identified as the company behind the IPO.

Pricing and market backdrop

Dongshan Precision priced 113.8 million shares at HK$86.80 apiece for the offering.

That price was 7.5 per cent below the indicative maximum price and 27 per cent below the Tuesday close of its Shenzhen-listed stock.

The company is a key supplier of components for AI servers, linking its business to a sector facing a deepening sell-off in China.

The weak performance in Hong Kong followed the company’s decision to proceed with the HK$9.9 billion IPO despite the difficult market backdrop for AI and tech hardware stocks.

Shares later bounced back slightly, but remained down 4.6 per cent at 9.45am.

The debut therefore put the company’s IPO pricing and its exposure to AI-server components under immediate market scrutiny.

Source: South China Morning Post