Bilibili shares drop to open on Hong Kong IPO

GUANGZHOU, China – Shares of Chinese video and game company Bilibili opened lower on the first day of trading in Hong Kong on Monday.

The Chinese tech firm listed on the Nasdaq has raised about $ 2.6 billion after valuing its shares at HK $ 808 (about $ 103) last week.

Bilibili stock opened at 790 Hong Kong dollars, down 2.2%. They extended those losses to an intra-day low of HK $ 753, nearly 7% below the bid price. At around 10:45 am local time, Bilibili shares were trading at 785 Hong Kong dollars, down 2.8%.

Bilibili is already listed on the Nasdaq in the United States and that was its secondary listing, when the company issues shares on another stock exchange. Unlike initial public offerings where companies issue shares for the first time, secondary listings typically don’t see huge price movements on day one.

A number of Chinese US-listed stocks have secondary listed in Hong Kong, including Alibaba and Baidu, amid continuing tensions between Washington and Beijing that threaten to impact foreign companies listed on Wall. Street.

Last week, the United States Securities and Exchange Commission passed a law that could increase audit requirements for Chinese companies and also empower authorities to de-register certain companies that do not follow the rules.

A secondary listing could be a protection against a write-off.

Bilibili’s Hong Kong debut also comes as Chinese tech stocks are sold. Last week, some of the biggest names on the double list lost billions of dollars in just a few days.

Not only do these companies face the threat of delisting in the United States, but they also face increased regulatory scrutiny domestically. It weighed on investor sentiment towards Chinese tech names.

Bilibili makes money from mobile games and selling virtual gifts to users who then give them to their favorite live streamers. Its US-listed shares have risen more than 300% in the past 12 months.