Weibo (WB) stock slumps on Hong Kong debut
08:54, 8 December 2021
Chinese microblogging platform Weibo Corporation closed over 7% lower to its final offer price on its Hong Kong stock exchange debut on Wednesday.
Weibo, which has a primary listing on the Nasdaq, closed at HKD253.2 in Hong Kong on Wednesday. A final offer price of HKD272.8 per share was set for its Hong Kong public offering.
The company’s stock slump on its Hong Kong debut comes on the back of reduced investor appetite for US-listed Chinese tech companies, following the delisting of DiDi Global just over five months into the ride-hailing firm’s New York initial public offering (IPO).
Hong Kong tech near record lows
In Hong Kong, tech companies have seen stock prices tumble in recent sessions in anticipation of further regulatory scrutiny from state authorities.
The Hang Seng TECH index hit a new all-time low earlier this week and has lost about 25% year to date.
Souring Sino-US relations is also a cause for concerns to investors. The Biden administration announced that US diplomats will boycott the 2022 Winter Olympics in Beijing.
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“Tangible risks”
“Weibo is currently trading at 37.2x 2020 P/E, above the average of other internet peers. Amidst tightening internet regulation, there could be tangible risks associated with the company’s operations and advertising revenue,” said Singapore-based investment firm KGI Securities.