(Yicai) July 9 -- Luxshare Precision Industry, a leading Chinese supplier of high-end precision manufacturing and artificial intelligence device solutions, made its Hong Kong Stock Exchange debut today in the bourse’s largest initial public offering so far this year. However, the shares fell below their offer price on the first day of trading.

Luxshare raised HKD24.3 billion (USD3.1 billion) at a final issue price of HKD63.28 (USD8.07) per share, completing its dual listing in Hong Kong and Shenzhen. The share price [HKG: 2475], though, dropped as much as 9.6 percent during the session and ended the day down 1.5 percent at HKD62.30 (USD8).

The company's Shenzhen-listed stock [SHE: 002475], though, closed up 3.1 percent at CNY64.40 (USD9.50).

Of the proceeds raised, 35 percent will be used to expand production capacity and upgrade manufacturing facilities, 30 percent will go toward technological research and development as well as improving manufacturing processes and smart manufacturing capabilities, 15 percent will be allocated to investments in upstream, downstream or related high-quality assets, 10 percent will be used to repay interest-bearing bank loans and the remaining 10 percent will be used for working capital and general corporate purposes, according to the prospectus.

Luxshare reported record profit and revenue last year. The Shenzhen-based firm’s net profit surged 24.2 percent from the year before to CNY16.6 billion (USD2.4 billion), while operating revenue soared 23.6 percent to CNY332.3 billion (USD48.9 billion).

Based on last year’s revenue, Luxshare ranked second globally in the Precision Intelligent Manufacturing Solutions market for consumer electronics components and modules, with a global market share of 11.2 percent, according to US business consultancy firm Frost & Sullivan.

Revenue generated from customers other than its largest client, US tech giant Apple, exceeded CNY150 billion (USD22 billion) last year, accounting for about 43 percent of total revenue. This was a gain of roughly 18 percentage points from 2023, indicating that Luxshare has continued to reduce its reliance on its biggest customer.

Notably, while pursuing its Hong Kong listing, Luxshare also continued buying back its Shenzhen-listed shares. As of June 30, the firm had repurchased 17.6 million shares, accounting for 0.24 percent of its total share capital, at prices ranging from CNY50.14 (USD7.40) per share to CNY65, according to a company announcement. The transactions totaled approximately CNY1 billion (USD147 million).

Editor: Kim Taylor