Shares of Befar Group (06745) commenced trading on the Hong Kong exchange today, opening significantly lower.

The company had set its final offer price at HK$3.48 per share, issuing a total of 352 million shares, with each board lot comprising 1,000 shares. The net proceeds from the offering are approximately HK$1.16 billion.

In early trading, the stock was down 21.26%, trading at HK$2.74 with a turnover of HK$50.56 million.

Company Overview and Market Position

According to its listing documents, Befar Group is a diversified chemical group in China, with operations spanning three core segments: chlor-alkali chemicals, C3/C4 chemicals, and wet electronic chemicals.

The company holds a leading position in the domestic chlor-alkali chemicals industry. Its key products include caustic soda, propylene oxide, MTBE, and electronic-grade hydrofluoric acid.

Integrated Operations and Financial Performance

Leveraging its integrated industrial chain, the company is capable of independently producing a portion of the raw materials required for its operations.

Notably, Befar Group recently issued a positive profit alert for the first half of the year, forecasting a net profit of RMB 344 million, representing a substantial increase of 208.25% year-on-year.

During the period, the company's various production facilities maintained stable operations, with output of major products remaining steady. Concurrently, influenced by international political factors and geopolitical conflicts, global prices for chemical raw materials have risen.

This has led to a recovery in the market for some of the company's products, with significant year-on-year increases in the prices of major products such as propylene oxide, allyl chloride, and propylene, contributing to improved gross margins.