Hong Kong based jewelry retailer Chow Tai Fook raised HK$15.75 billion ($2.02 billion) by selling 1.05 billion shares to investors. The company has an ambitious expansion plan in China. The raised funds are to finance the expansion.
The HK$15 per share selling price was on the lower end of the HK$15-21 price range offer. Uncertain and volatile global economic markets have led investors to a cautious purchase.
“The poor reception of IPOs reflects weak global investor sentiment,” Cedric Ma, Hong Kong-based senior strategist at Convoy Asset Management Ltd., told Bloomberg. “The market is also looking a little bit crowded since a lot of companies are trying to raise cash at the same time.”
With 1,500 stores in Hong Kong and China, Chow Tai Fook has 12.6 percent of China jewelry market, and a 20 percent share in Hong Kong and Macau, the company said in the IPO filing, citing a Frost and Sullivan report.
The retailer plans to increase the number of stores to 2,000 by 2016.
Chow Tai Fook's shares will begin trading on Thursday.
