Livestreaming Unicorn DouYu Serves Up a Plain Debut in New York
Shares in the Tencent-backed company were trading below the issue price by midday at its debut.
DouYu International Holdings Ltd. (Nasdaq: DOYU) rang the Nasdaq opening bell on Wall Street Wednesday, seeing its stock trading below the issue price by noon.
Shares in the Chinese company opened at $11.02 apiece and rose to $11.32 by noon, still 2 percent below the $11.50 issue price.
In all, DouYu raised $775 million by selling 67.4 million of its ADSs, with another 10.1 million available for underwriters to cover over-allotments.
The Tencent-backed firm invited the anchors of the platform on the initial public offering day, covering games like League of Legend, Dungeon-Fighter and Dota2.
The company, a rival of Huya Inc. (NYSE: HUYA), initially filed for an IPO of up to $500 million in April but held off its plan amid trade woes between China and the United States. Last month, DouYu picked up the process and raised its IPO target to up to $943 million, which would have led to a market capitalization of $25 billion.
Chinese tech giant Tencent Holdings Ltd. (HKEX: 0700) holds 43 percent in the company.
The Wuhan-based company streams a variety of content on its video-sharing platform. In addition to gaming, DouYu broadcasts sports, cooking and other entertainment. It also hosts virtual game tournaments on a massive scale, drawing hundreds of thousands of arcade fans.
DouYu reported that its revenue has more than doubled to $221.9 million in the three months through March from $98 million from the same period last year. It turned profitable in the first quarter when its net income reached $2.7 million in contrast to a net loss of $23 million a year ago.
"DouYu started with two fresh graduates and there are only 4 employees in total," Wenming Zhang, cofounder of DouYu, has said in an interview. Zhang and Shaojie Chen, the chief executive officer of DouYu, were classmates in primary school.
"Today is the highlighted moment of DouYu, but it is by no means a peak moment. Freely, fish enjoy a good swim in the broad ocean, and DouYu, meaning 'fish warrior' in Chinese, is determined to make progress and create more value for users and shareholders," Shaojie Chen said on the Nasdaq.
The stock of Huya, DouYu's direct rival in China, was trading down 4 percent intraday Wednesday, at $23.20 per American depositary share.