HONG KONG - Baidu Inc shares have closed flat in their Hong Kong secondary listing debut on Tuesday, bucking a trend of first-day pops on the bourse, as investors were wary of a fundraising flurry in the city and questioned the search company’s growth plans.

The weakened mood towards Chinese mainland technology offerings was reinforced with video site Bilibili raising a lower-than-expected US$2.6 billion in its secondary listing.

Baidu shares closed at HK$252 each which was in line with the price set for the Hong Kong listing which raised US$3.1 billion.

It was the weakest debut for a US-listed company debut in Hong Kong since Yum China shares dropped 5.3 percent in their first session in September after raising US$2.2 billion

Hong Kong’s Hang Seng Index lost 1.3 percent in the session.

It was the weakest debut for a US-listed company debut in Hong Kong since Yum China shares dropped 5.3 percent in their first session in September after raising US$2.2 billion.

Baidu’s lacklustre debut contrasted with some of the city’s other major first-day movers in 2021, such as Kuaishou Technology which gained 160 percent in early February.

LightStream Research analyst Shifara Samsudeen said secondary listing debuts were generally not as strong as primary listings, but noted investors were wary of Baidu’s future growth and diversification plans.

“We think it will take a few more quarters for the market to duly appreciate Baidu’s efforts in cloud and other initiatives and value the stock as a comprehensive internet stock,” Samsudeen, who publishes on Smartkarma, told Reuters.

Hong Kong has seen US$31.4 billion raised through share sales so far this year, compared to US$8.6 billion over the same period last year, prompting concerns that the appetite to buy new deals could be weakening.

READ MORE: Baidu seeks up to US$3.6 billion in Hong Kong second listing

“There is too much paper around, the listings have been never-ending and companies have raised money so easily without any real need,” said one Hong Kong fund manager who could not be named as he was not authorized to speak to media.

“The ones coming back to Hong Kong make sense, but a lot don’t make sense.”

Baidu’s deal was 112 times oversubscribed by retail investors while the institutional book was covered 10 times, according to the company’s filings with the city’s exchange

Baidu chairman and CEO Robin Li said the secondary listing was a homecoming for the company.

“When Baidu got listed in Nasdaq...I said Nasdaq was only one of our stops. Baidu would come back to China eventually, because China is our root. Today, Baidu finally came back home,” he told a ceremony in Beijing.

The proceeds will be used for investment in technology and Baidu's mobile ecosystem, among others.

ALSO READ: Many mainland companies to have secondary listing in HK

In its prospectus, the tech firm highlighted its leading position in artificial intelligence (AI) and said it owns the largest portfolio of AI patents and AI patent applications in the mainland. Baidu App, which is at the core of the company's mobile ecosystem, had 544 million monthly active users last December.

Baidu’s deal was 112 times oversubscribed by retail investors while the institutional book was covered 10 times, according to the company’s filings with the city’s exchange.

Bilibili finalized its secondary listing on Tuesday, raising a smaller sum than the company’s initial target of about US$3 billion.

With Xinhua inputs