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Abstract
China's new tea industry has recently been exploring overseas listing opportunities, with two companies experiencing breakdowns in their Hong Kong IPOs. ChaPanda, the second new tea beverage company to list, saw a year's worth of turnover evaporate on its first day on the Hong Kong stock market, falling far below investors' expectations. Back in 2021, the IPO of "Nayuki's Tea" on the Hong Kong Stock Exchange also faced a similar breakdown, attributed to overpriced valuations in the new tea beverage industry. These above-average IPO valuations are often influenced by online public opinion and media evaluations, affecting both IPO pricing and stock prices on the first day. Additionally, since the outbreak of the COVID-19 pandemic, mainland companies breaking on their first day of IPOs on the Hong Kong stock market have remained relatively high compared to the overall market. This article uses ChaPanda as a case study to explore the reasons behind the frequent IPO breakdowns in the new tea beverage industry on the Hong Kong stock market. It examines three key aspects: industry background, enterprise valuation efficiency, and investor sentiment, as well as the issuance risks of listing on the Hong Kong Stock Exchange. The aim is to provide practical references and suggestions for reasonable pricing of future IPOs in the same industry.
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