Shares of Chinese online travel company Trip.com Group climbed on the first day of trading in Hong Kong on Monday as the country looks forward to a strong recovery in travel during the upcoming Labor Day holiday.
The Nasdaq-listed firm raised roughly HK$8.5 billion ($1.09billion) after pricing its shares at HK$268 ($34.49) each last week. Later, the company’s stocks opened 4.85% higher at HK$281 (&36.16) apiece at their launch on the Hong Kong Stock Exchange.
“By being dual-listed in the US and Hong Kong, we are able to have a truly global offering that better reflects our international presence and outlook,” Jane Sun, chief executive officer of Trip.com Group, said at a ceremony held at the company’s Shanghai headquarters on Monday.
Trip.com Group said it plans to use the net proceeds from this listing to invest in technology that will bolster its leading market position, and to fund its continuing enhancement of user experience.
Chinese brokerage firm Chasing Securities estimated that Chinese tourists would make nearly 200 million trips throughout the upcoming five-day holiday starting May 1, which would make it the country’s busiest Labor Day travel period ever, Dow Jones reported.
According to Trip.com, China’s largest domestic online travel agency, as of April 14, air ticket bookings for the Labor Day holiday have increased by 23% compared to the same period in 2019. Hotel bookings were up by 43%, tourists attraction tickets by 114%, and car rental bookings by 126%.
Official data showed that during the recent three-day Tomb Sweeping Festival which ended April 5, Chinese residents made 102 million domestic trips, 94.5% of the level recorded in 2019. Tourism revenue reached 27.2 billion yuan ($4.2 billion), 57% of the overall 2019 figure.
Trip.com joins a growing cohort of US-listed Chinese companies planning to stage secondary offerings in Hong Kong amid heightening tensions between Washington and Beijing. Refinitiv data indicate that the so-called “homecoming” listings in the Asian financial hub have totalled $36 billion since Alibaba kicked off the trend with a $12.9 billion float in 2019, Reuters reported.
Last month, the US Securities and Exchange Commission adopted a law which could kick foreign companies off American stock exchanges if they don’t comply with US auditing requirements. A secondary listing in Hong Kong could help US-listed Chinese companies to hedge against the risk of being delisted and to diversify investor bases.
SEE ALSO: Trip.com Obtains Go-Ahead for Secondary Listing in Hong Kong
Founded in 1999, Trip.com Group provides services including accommodation reservation, transportation ticketing, packaged tours and corporate travel management. It owns and operates Trip.com, Skyscanner, Qunar, and Ctrip, all of which are online travel agencies.