Shares ofNongfu Spring, China’s leading seller of bottled water, debuted strongly in their first day of trading in Hong Kong, buoyed by a combination of strong demand and scarcity of new shares on offer, reported Caixin.
The company’s stock opened 85% above its listing price of HK$21.50 ($2.77), before inching down through the session to close up 54% at HK$33.1. The company raised HK$8.35 billion after pricing its shares at the top of their range.
The strong first-day performance also vaulted the company’s founder Zhong Shanshan into the ranks of China’s richest men. His 84.4% of the company post-IPO gave him a fortune worth about $40 billion, based on the company’s latest market value. Nongfu is a clear leader in China’s bottled water industry, and also a major player in its broader drinks sector. It was the biggest player in bottled water last year with 21% of the market, according to Frost & Sulllivan research cited in Nongfu’s prospectus. It was also the No. 3 player in the separate tea and juice products categories, as well as in functional beverages such as sports drinks.