This undated photo shows Consumers browse toys at a Pop Mart store in Shanghai. (CHEN YUYU / FOR CHINA DAILY)

HONG KONG - Mainland toymaker Pop Mart International Group made a stellar debut on the Hong Kong stock market on Friday, closing nearly 80 percent higher than its issue price to end the day with a market capitalization of US$12.5 billion.

Pop Mart priced its IPO shares at HK$38.50 in the deal that was hotly contested by institutional and retail investors

The firm, which sells the ‘Molly’ doll and figurines wildly popular among mainland’s cashed-up millennials, had opened 100 percent higher in the initial burst of buying, before late profit-taking brought it back to close at HK$69, up 79.2 percent from its issuance price of HK$38.5.

The broader Hang Seng Index rose 0.36 percent on the day.

Pop Mart’s main product is “mystery” toy boxes that each hold a single figurine from different collections while its best selling character is the round-faced Molly doll.

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The stock was the most actively traded stock by turnover on the Hang Seng on Friday, and maintained a run of strong first-day performances for deals in the city.

Pop Mart raised US$676 million in an initial public offering (IPO) which gave the company a valuation of US$7 billion ahead of the trading debut.

The IPO had been under consideration for at least a year but the company and its advisors held off until the coronavirus pandemic passed in the mainland, according to sources working on the deal.

Pop Mart has 136 stores on the mainland and 1,001 vending machines and plans to use some its IPO proceeds to open another 183 new retail shops and 1,800 more mobile outlets over the next two years, the prospectus said.

The attraction of the toys even lured the normally serious bankers who worked on the deal.

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“I bought a lot,” said one dealmaker who could not identified as he was not authorised to speak to media.

The share-price surge puts the stock among the best-performing debutants for the city on record for deals over US$500 million, Refinitiv data showed.

Just this year, Smoore International Holdings Ltd stock shot up 150 percent on debut in July, Nongfu Spring Co Ltd gained as much as 85 percent in September while JD Health International Inc gained 56 percent when it debuted on Tuesday.

GEO Securities Chief Executive Francis Lun said the first day ‘pop’ of IPOs in Hong Kong was driven by investors taking on leverage to buy into deals.