Zhongji Initiates Buy-Back Amid Pre-Hong Kong IPO Sell-Off

The buy-back came on the heels of a sell-off in Zhongji’s yuan-denominated stock, which was closing in on the offer price of HK$980 for the Hong Kong initial public offering (IPO). A further decline in the onshore stock would increase the risk that its Hong Kong-listed shares dip below the IPO price on the first day of trading, a setback for the company as it banks on an offshore listing to expand its overseas business and build up a corporate image among global investors. “Zhongji’s buy-back plan comes at a sensitive time, namely just ahead of its Hong Kong listing,” said Dai Ming, a fund manager at Huichen Asset Management. “The most plausible reason for doing this is to bolster sentiment before the Hong Kong debut,” he added.