UTime Shows It's Still a Great Time for Chinese IPOs, Skyrockets 1000%

After last week's delays, things are looking up for the Chinese company.
CapitalWatch StaffApr 06,2021,21:53

UTime Ltd. (Nasdaq: UTME) has enjoyed a striking good debut Tuesday after last week's postponement. In the afternoon, shares in the Chinese budget phone maker traded 602% above issue price, at $28.07 apiece.

UTime priced its offering at $4 per share, the low end of the expected range of $4 to $5. The company sold 3.8 million shares and raised $15.2 million for purposes including expanding in the U.S. market. Earlier today, UTME stock surged over 1000% on heavy volume and has halted a number of times.

Boustead Securities, Brilliant Norton Securities, and Fosun Hani Securities are underwriting the deal.

UTime appeared on Nasdaq’s schedule for planned lift-off on April 1, but was taken off the IPO list by midday. Bloomberg interpreted the numerous delays early this quarter as a sign of market weakness, citing the postponements and size reductions across global exchanges. Chinese company Smart Share Global Ltd. (Nasdaq: EM) was among those that experienced the IPO troubles first-hand as it debuted on Friday.

Today, however, UTime celebrates with fanfare, enjoying U.S. investors’ interest toward small-cap Chinese companies.

The company first publicly filed for a U.S. listing in March 2020, showing declining sales. A year later, however, its updated financial data shows an upturn. In the six months through September, UTime booked $26.3 million in revenue, nearly doubled from the same period of 2019. The company also turned up profit in the six months, posting nearly 7 million yuan ($1 million) in income in contrast to losses of 9.8 million yuan.

Based in Shenzhen, UTime sells cost-effective mobile devices to consumers globally, including the United States, India, Brazil, and some countries in South Asia, Africa, and Europe. It has subsidiaries operating in Hong Kong and India. The company also provides manufacturing services to other makers of electronics.

The company plans to use the IPO capital to grow its U.S. branch, expand global sales and distribution teams, increase promotions, launch 4G feature phones and develop Bluetooth glasses, according to the prospectus.

Topics:UTME, UTime, China