XJ ELECTRICS (02619.HK), a lifestyle household goods manufacturer, saw its shares plummet 5.59% in its trading debut on the Hong Kong Stock Exchange, despite a heavily oversubscribed initial public offering (IPO). The stock's weak performance comes as a surprise given the strong investor interest during the IPO process.

The company had priced its IPO at HK$2.86 per share, the bottom end of its proposed range which went up to HK$3.35. This pricing decision raised HK$155.6 million in net proceeds for XJ ELECTRICS. The Hong Kong public offering portion was 852.38 times oversubscribed, triggering a clawback mechanism that increased the number of shares allocated to the public offering.

The stark contrast between the IPO's popularity and the stock's performance on its first trading day suggests that investors may be reassessing the company's valuation. Market analysts speculate that the initial enthusiasm might have been tempered by concerns about the company's growth prospects or the overall market conditions. As XJ ELECTRICS navigates its first days as a public company, investors will be closely watching its performance to gauge whether this initial drop is a temporary setback or indicative of broader concerns.