Shares in China’s smartphone giant Xiaomi dip on Hong Kong debut

HONG KONG: Chinese smartphone giant Xiaomi fell on its Hong Kong stock debut on Monday, following a long-awaited initial public offering overshadowed by China-US trade tensions and falling global markets. Even before public trading started confidence was low, with investors selling at a discount on the unofficial “grey market” last week, Bloomberg News reported. And on Monday it ended down 1.18 per cent at HK$16.80, though that was much better than in mid-morning trade, when it was briefly down almost six per cent. Despite being one of the most anticipated Chinese technology IPOs this year, Xiaomi saw a disappointing valuation of $54 billion, well below its ambitious $100 billion target. Founded in 2010 by entrepreneur Lei Jun, Xiaomi has grown from a start-up in Zhongguancun — China’s ‘Silicon Valley’ — to become the world’s fourth-biggest smartphone vendor at the end of last year, according to International Data Corp. The company’s founder has described Xiaomi as a “new species” of company with what he describes as a “triathlon” business model combining hardware, Internet and e-commerce services. Its products range from smart home gadgets like air purifiers to non-tech items such as pillows and ballpoint pens. A delay in Xiaomi’s plan to launch new so-called Chinese Depository Receipts (CDRs) in Shanghai as well as doubts about the sustainability of its business model were also among reasons for the lower valuation, analysts said. — AFP