Xiaomi Share Launch Hit by Trade Woes

Chinese Smartphone Maker Xiaomi Falls in Hong Kong Trading Debut

As the Chinese phone manufacturer maker made its IPO, its shares were down more than 2 percent and fell by 5.88 percent during the session.

Xiaomi shares closed at HK$16.80, having touched a low of HK$16 in early trade, compared to the IPO price of HK$17 per share.

Xiaomi faces nearly 5% share fall in Hong Kong trading debut, indicating a disappointing pricing and a slow start in mainland China.

Despite being one of the most anticipated Chinese technology public offerings this year, the group saw a disappointing valuation of US$54 billion, well below its ambitious US$100 billion target.

That puts Xiaomi's market value at about US$50 billion, becoming the world's third largest listed maker of mobile devices.

Xiaomi's IPO valued the firm, which also makes internet-connected home appliances and gadgets, at $54 billion, nearly half the $100 billion it had initially hoped for and below its more recent target of at least $70 billion. While Xiaomi does not sell its products in America at the moment, the company has said it plans to before the end of next year.

Yerry Mina sends Colombia-England into extra time
He said: "There's some big teams gone out of the World Cup and this could be the year England can go far and hopefully win it". In the end, it came right down to the wire, with a tense penalty shoot-out that left Britons' hearts in their mouths.

Xiaomi's debut is seen as a key test of investor sentiment for what is expected to be a packed second-half of the year for Hong Kong IPOs, with offerings including online food delivery-to-ticketing services platform Meituan Dianping.

"We are an internet company and from Day 1 we have set up a weighted voting rights structure with dual-class shares", he added. Ping An Healthcare and Technology Co Ltd dropped below its IPO price on the second day of trading in May.

The soggy debut performance of the company hasn't come as much of a surprise for some analysts.

"No matter how you look at it, it's too expensive for me", said Francis Lun, chief executive officer at brokerage GEO Securities, drawing comparisons between the price-to-earnings ratio of Xiaomi and Apple.

Founder Lei Jun described Xiaomi as a new species of company, pursuing a "triathlon business model" combining hardware, internet and e-commerce services.

It is now the biggest smartphone vendor in India and is pushing into European markets including Spain and Russian Federation, though it has lost share in China recently to lower-cost rivals.

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