STAR SPORTS MED's stock plummeted 5.27% during intraday trading on Friday, reflecting continued sharp swings after its recent initial public offering.
The volatility is attributed to the absence of standard IPO price-support tools such as an over-allotment option (greenshoe mechanism) and a stabilization agent. Without these mechanisms, selling pressure is absorbed solely by organic market forces, amplifying price movements. Additionally, the stock's Hong Kong public offering was oversubscribed 7,823 times, leading to aggressive profit-taking by early subscribers post-listing, coupled with thin liquidity conditions as daily turnover has declined sharply.