Market Overview

Chinese Internet Giant NetEase's Shares Surge In Hong Kong On Debut

Share:
Chinese Internet Giant NetEase's Shares Surge In Hong Kong On Debut

NetEase Inc. (NASDAQ: NTES) shares soared by over 8% on the first day of trading in Hong Kong, amid rising tensions between the United States and China.

What Happened

NetEase, an internet company from China engaged in gaming, education, and music streaming, has also been listed on the Nasdaq since 2000. 

On their debut in Hong Kong, NetEase shares, priced at 123 Hong Kong dollars or $15.87 each, soared to 133 Hong Kong dollars or $17.16, soon after the markets opened.
NetEase’s listing occurs at a time of rising tensions between the U.S. and China, and some companies returning to Hong Kong. bc

Alibaba Group Holding Ltd (NYSE: BABA) held a huge secondary listing in Hong Kong late last year, raising $12.9 billion, while JD.com Inc. (NASDAQ: JD) is planning one for late 2020.

NetEase told CNBC that it would use the money raised for “globalization strategies and opportunities" as well as for general corporate purposes.

Why It Matters

NetEase has raised a total of $2.72 billion by offering 171,480,000 new ordinary shares in the Hong Kong market, reported CNBC.

The firm is looking to bolster its education and music streaming products and is following its rival Tencent Holdings Ltd (OTC: TCEHY) in a bid to expand its global footprint by investing in gaming companies.

NetEase said that 25 ordinary shares are worth one Nasdaq-listed American depositary share, meaning each 123 Hong Kong dollar offer price is equal to $397 per ADS.

As tensions between the U.S. and China, some Chinese companies are delaying their U.S. listings.

NetEase Price Action

On Thursday, NetEase shares traded 7.14% higher at $131.40 at press time in Hong Kong. The company’s shares traded 3.77% higher at $424.98 on Wednesday and declined 0.47% to $423 in the after-hours trading.

Image: Wikimedia 

 

Related Articles (BABA + JD)

View Comments and Join the Discussion!

Posted-In: China CNBCNews IPOs Global Markets Media General Best of Benzinga