Chinese online grocery delivery company MissFresh saw its share price tumble 25.7 per cent from the IPO price, closing at $9.66 a share.
The MissFresh IPO was one of the largest US offerings in 21 years however its debut has been a bumpy ride so far.
The company had initially raised $273 million from selling stock at $13 per American Depositary Receipts (ADS) earlier this month.
An ADS is a means for US investors to gain investment exposure to non-US stocks without the normal complications of dealing in foreign stock markets.
While the IPO performance hasn’t met expectations so far, company founder Xu Zheng is optimistic about the grocery delivery space, especially in China’s seemingly ever-growing urban areas and cities.
“The big cities are becoming mega cities, and people are having more and more demand for consumption upgrade, for quality and convenience,” he told Forbes.
China’s retail market was worth over 11.9 trillion yuan last year, 5 million of which from fresh produce and the rest from fast-moving consumer goods according to MissFresh, its analysts expect the market to reach 15.7 trillion yuan by 2025.
Xu attributed MissFresh’s successes to the company being aware of its long-term plans from early on.
“We have always been thinking about the long term and how to build channels that meet the needs of the next generation of consumers,” Xu added.
MissFresh shareholders include Tencent, which holds a 7% stake.
The US IPO market that had its busiest quarter in more than two decades in April-May , with 113 IPOs raising $39.9 billion, according to figures from Renaissance Capital.