BRIEF: Impression Dahongpao sinks in Hong Kong trading debut
Shares of cultural tourism company Impression Dahongpao Co. Ltd. (2695.HK) opened down 9.4% at HK$3.26 in their Hong Kong trading debut on Monday, then continued to fall to close down 25% by the midday break.
The company sold 36.1 million shares for HK$3.60 apiece, representing the lower end of their range, raising net proceeds of HK$103.6 million ($13.3 million). The public portion of the offering for local investors was oversubscribed by 3,396 times, while the international placement was slightly oversubscribed.
The company’s biggest vulnerability lies in its singular revenue stream, 90% of which comes from its “Impression – Dahongpao Scenery Show.” The production is subject to seasonal and weather-related disruptions, and its long-term prospects also remain questionable as audience interest gradually wanes.
The company recently launched a new show, “Moonlight over Mount Wuyi,” which premiered in May, generating 2.37 million yuan ($337,000) in the first half of the year.
By Lau Chi Hang
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