Xiaomi shares drops below IPO price again

小米再度破发 “翻倍”将成泡影? – 上海证券报

What happened: Shares of Chinese smartphone maker Xiaomi dropped below HK$16.8 issue price during an intraday trade on August 2. Xiaomi went public in Hong Kong on July 9, and its shares jumped below the issue price on the IPO day. Lei Jun, CEO of the company, once promised investors who bought Xiaomi shares on the IPO day that their return would double in the future.

Why it’s important: The instability of Xiaomi share prices implies market concerns for Xiaomi’s business, which is in contrast with Lei Jun’s optimism. Lei Jun considered Xiaomi as a big all-round corporation that specializes in hardware, e-commerce, and the Internet. Lei Jun once said Xiaom’ valuation should be that of Tencent multiplied by that of Apple, which, unlike Xiaomi’s tumbling shares, just breached $1 trillion stock market valuation.

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