Chinese financial technology group Lufax Holding Ltd. opened at $11.60 on Friday after it secured $2.4 billion in a U.S. initial public offering priced at the top of an indicative range.
Lufax unloaded 175 million American depositary shares (ADS) for $13.50 apiece, trading at $13.15 at noontime in New York, giving the fintech a market value of a little over $32.1 billion, below the nearly $40 billion in its last fundraising in late 2018, according to data provider PitchBook.
The Chinese company plans to use the money to boost marketing, develop new products, tech infrastructure, and future procurements. It is an associate company of Ping An Group, China's biggest insurer by market value, and mainly offers business and personal loans and wealth management services.
The company's IPO was the largest China-to-U.S. stock market listing since the $2.5 billion Nasdaq float of video-streaming service iQiyi in March 2018.
Lufax's foray into the American market coincides with a week of significant volatility. The S&P 500 Index saw a slump in four months in the midst of concerns about the impact of the coronavirus pandemic.
U.S. stocks rallied late Thursday, with investor appetite boosted by better-than-estimated economic figures. The S&P 500 was up 1.2 percent, the most since the middle of the month.
Mortgage lenders AmeriHome and Caliber Home Loans and software company Mavenir were among the groups that backed out from their IPOs earlier this week after forecasting volatility in stock markets in the final days of the U.S. presidential polls.
Still, 2020 has so far been a bumper year for capitalists who shell out huge amounts of money on fresh listings after searching for alternate investment channels, as low-interest rates have reduced returns on conventionally secure investments like bonds.
Lufax had to cancel its original IPO plans in Hong Kong in the wake of transitions in the financial district's financial policies, and shift its operations before trying to go public again.
Once among China's biggest peer-to-peer lending groups, Lufax has evolved into a financial powerhouse that specializes in retail lending services and wealth management.
HSBC Holdings, Bank of America, Goldman Sachs, UBS Group, and China PA Securities led Lufax's IPO. The fintech's shares are trading on the New York Stock Exchange under the ticker "LU."
Lufax's IPO in the U.S. will provide the company with broad access to the nation's robust capital market, although geopolitical frictions could become a major issue.
