FAST NEWS: AI giant Fourth Paradigm opens 13.5% higher in trading debut

The latest: Shares of AI company Beijing Fourth Paradigm Technology Co. Ltd. (6682.HK) opened at HK$63.10 in their Thursday trading debut, 13.5% higher than their IPO price of HK$55.60.

Looking up: The local portion of the company’s public offering in Hong Kong was oversubscribed by about 10 times, while its international offering was oversubscribed by a more modest 57%.

Take Note: Despite the strong interest from local investors, the company’s shares still priced at the lower end of their IPO price range, raising HK$830 million ($106 million).

Digging Deeper: As a leading AI company in China, Fourth Paradigm provides platform-centered AI software that primarily helps enterprise customers develop their own decision-making applications. The company’s path to listing has been anything but smooth. It first filed for a Hong Kong IPO in 2021, but its first three attempts were rejected before it finally got approved in early September. It suffered a setback this year in March when its name appeared on the U.S. Commerce Department’s “entity list,” a sort of blacklist limiting the company’s ability to buy U.S. products and services. That prompted Goldman Sachs to withdraw as its IPO sponsor, with China’s own CICC International taking over.

Market Reaction: After initially opening higher, Fourth Paradigm shares gave back some of those gains on Thursday morning and closed up 5.2% at HK$58.5 by the midday break

Translation by A. Au

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