Shares of semiconductor startup BaTeLab fell in their Hong Kong trading debut.
BaTeLab’s shares fell on its trading debut in Hong Kong, falling below its initial public offering price following a sluggish start for the Chinese semiconductor company backed by electric vehicle giant BYD 1211.
Shares of the Chinese integrated circuit provider fell as much as 14% on Thursday morning before trimming losses. It was last down 2.8% at HK$26.70. The benchmark Hang Seng Index HK:HSI rose 1.6% to 16895.58.
BaTeLab raised HK$412.05 million (US$52.8 million) in the IPO, pricing it at the lower end of its initial guidance range of HK$27.47 to HK$38.45 per share, it said in an exchange filing on Wednesday.
According to Frost & Sullivan, BaTeLab was China’s largest supplier of analog IC patterned wafers by 2022 revenue.
BaTeLab’s revenue reached HK$352.5 million in 2022, up 66% year-on-year. However, amid the recession in the global semiconductor industry, sales growth in the first half of 2023 slowed to 26% compared to the same period last year.
The company recorded negative operating cash flow in two of the three years from 2020 to 2022. Last year’s net cash outflow from operating activities was due to increases in advances, inventory, and receivables.
According to the prospectus, the company plans to use the proceeds to strengthen its research and design capabilities, strengthen its product portfolio, and make strategic investments.
CICC, China Galaxy International and CMB International are among the joint advisors to BaTeLab IPO.
