Sep 10, 2020 07:44 PM

Yum China Hong Kong Debut Leaves Investors Hungry

What’s new: Shares of Yum China Holdings Inc., operator of KFC and Pizza Hut restaurants on the Chinese mainland, fell about 4% on their first day of trading in Hong Kong.

The stock was down 4.03% late on Thursday at HK$395.4 ($51.02). It set its Hong Kong IPO price at HK$412 around Sept. 3 in the U.S., where its stock has been traded since its New York listing in 2016.

The background: Yum China’s listing makes it the latest high-profile Chinese company to make a second listing in Hong Kong to complement an existing older listing in New York. E-commerce giant Alibaba Group Holding Ltd. kicked off the trend when it made a second listing in Hong Kong in November, roughly five years after listing in New York.

First-day performances for such second listings are usually somewhat predictable since they tend to track the movement of the New York-traded stock. In this case, the 4% decline in Hong Kong was roughly equal to the drop Yum China’s New York shares saw since the pricing for the Hong Kong IPO was announced last week.

Despite the drop, the Hong Kong offering saw strong demand on bullishness about the company’s position as China’s top fast food operator. The retail portion was around 50 times oversubscribed, while the institutional portion was more than seven times oversubscribed.

Related: KFC Operator Yum China’s Hong Kong IPO Oversubscribed Dozens of Times

Quick Takes are condensed versions of China-related stories for fast news you can use.

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