(Bloomberg) -- Smoking pays for Chinese stock investors, judging by China Tobacco International HK Co.'s stellar debut in Hong Kong.
China Tobacco -- the biggest maker of cigarettes in the world -- has soared 55% in two days, despite a decline in the broader market against a backdrop of tightening liquidity and street protests. Several other companies that listed this week have fallen, including China East Education Holdings Ltd., which is down 8.1%.
“Other companies may be affected by market sentiment, the trade war or the political environment, but people need to smoke,” said Alvin Cheung, associate director at Prudential Brokerage Ltd. He said China Tobacco's initial public offering price wasn't expensive, which has also helped its performance.
Cheung said the weak starts for other new listings -- Kato Hong Kong Holdings Ltd. has fallen 6.7% and Tai Hing Group Holdings Ltd. is down 12% -- is mainly due to the decline in the Hang Seng Index and investors worrying about capital outflows from Hong Kong due to the political unrest rippling through the city.
China Tobacco Colossus Sets IPO for International Unit
The World Health Organization says there are more than 300 million smokers in China, and that about one in every three cigarettes smoked in the world is smoked in the country. Around 3,000 people die every day in China due to tobacco use, the organization says.
To contact Bloomberg News staff for this story: Ken Wang in Beijing at ywang1690@bloomberg.net
To contact the editors responsible for this story: Sofia Horta e Costa at shortaecosta@bloomberg.net, Will Davies, Philip Glamann
©2019 Bloomberg L.P.
With assistance from Bloomberg
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