It’s only been listed for a few hours, but China’s bubble tea answer to Pepsi Cola has already lost its fizz after investors deserted the initial public offering from the get-go.

On the Hang Seng Tuesday arvo, the stock price of China’s largest bubble tea chain Chabaidao saw its share price lose about 40% on its trading debut in Hong Kong.

Shares slumped early on Tuesday, debuting at HK$17.50 a pop, dropped to as low as HK$10.84 and closed at HK$12.80.

The Chengdu-based beverage giant was offering 147.7 million shares for expected proceeds of HK$2.5 billion.

Baicha Baidao put up 90% of its 147.7 million shares in an initial global offering, while the remaining 10% were available in a public offer in Hong Kong.

However, the public offer was only 0.5 times subscribed, leading the firm to reallocate the remainder of the shares to the global offer, which was 1.11 times subscribed.

In the prospectus, Chabaidao revealed that revenue for the financial year ended 2023 stood at 5.7 billion yuan ($786.8 million) and gross profit came in at 1.96 billion yuan in the same period.

Listed as Sichuan Baicha Baidao Industrial Co., but also known by its more user-friendly Chabaidao, which literally means 100 varieties of tea, has so far collapsed circa 38% in what was supposed to Honkers’ biggest IPO of the year so far.

Since 2021, the company claims compounded annual net profit clocked 21.6%. A fine number for a company with a known product and standing army of customers.

The US$135.7 million raised by RoboSense Technology in January was another disappointment, and comes after Hong Kong’s first-time stock offerings fell 30% in the quarter to US$604 million, the slowest start to a new year since 2009.

China’s third-largest maker of fresh tea drinks by sales value, had raised about HK$2.6 billion ($US330 million) in Hong Kong’s biggest new share sale since November.

Chabaidao runs ChaPanda stores, a popular bubble tea chain that has a particularly strong presence down in the south of China – think Canton – where the ubiquitous shops sell a range of fruity tea beverages targeted at the spendthrift youth.

Even if there’s a fair bit of the old sucrose involved.

The poor IPO is no horrific surprise to market watchers or participants, although the legions of young pearl tea drinkers in China and beyond might be mildly put off.

Hong Kong’s stock exchange has experienced its quietest first quarter since 2009, with only 12 new listings raising a mere HK$4.7 billion ($600 million), marking a significant downturn in the city’s IPO activity.

This slump has pushed the Hong Kong Stock Exchange down to 10th place globally in IPO proceeds for the early months of 2024

Hong Kong and greater China are grinding away at finding some kind of business happy place, but the search has been long and difficult.

Everywhere investor confidence in China is just shot to pieces by roiling property prices before and after a really rotten zero-COVID experience has left Beijing grasping at straws and flogging anything which looks slightly dressed up as a regulatory reform to get things moving again.

The local securities regulator said last week it will support IPOs by leading local firms in Hong Kong, as well as loosen rules on stock trading links between the city and mainland exchanges.

If this is the result of that, then it’s back to the headbutting head against board.

Hong Kong’s once unnassailable spot as South Asia’s market mother and its position as an international financial hub are falling as quickly as pearls in tea.