Shares of Tianqi Lithium slumped about 10% in their Hong Kong market debut Wednesday, after the Chinese firm raised about $1.7 billion in town’s largest itemizing up to now this 12 months.

The inventory traded at around 74.50 Hong Kong {dollars} ($9.49), decrease than the supply value of HK$82 ($10.45) a share. It slipped to as little as HK$72.65 earlier than paring again some losses.

Tianqi Lithium, which was already listed in Shenzhen, is one of the world’s prime suppliers of rechargeable battery parts for electrical autos.

“We are listed in China already and it is already a very good, big platform for financing. But it is limited in China,” Frank Ha, the chief director and CEO at Tianqi Lithium, instructed CNBC’s “Streets Signs Asia” on Wednesday.

“We going into the Hong Kong market that is our strategy of crossing the globe. We need to make an international platform for financing. That’s why that we considered and then evaluate the situation. I think the current time is the best time that we can come here to list in the market,” he added.

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The firm bought 164.12 million shares in its secondary itemizing in Hong Kong, in line with its regulatory filings. The share sale breaks a monthslong drought for big choices in Hong Kong, the place funds raised between January and June fell extra 90% from the earlier 12 months. 

Tianqi’s Hong Kong providing has drawn seven cornerstone traders which are set to snap up about 38% of the itemizing, the prospectus confirmed.

Tianqi Lithium’s outlook

Ha stated the electrical car market is exhibiting energy globally and isn’t just restricted to China.

“We can see that in Europe and in the other places in the world there is still very strong demand of EV,” he stated. Ha added electrical car demand in the subsequent 5 to 6 years is prone to keep elevated as extra nations pledge to change into carbon impartial by 2050.

The present market sentiment is kind of difficult however given fundamentals of Tianqi Lithium, the corporate’s earnings potential is best than others given “very high lithium prices,” stated Dennis Ip, head of energy and utilities, at Daiwa Capital markets.

“Tianqi Lithium share price is very driven by the lithium compound prices as well,” he instructed CNBC on Wednesday.

“We still think that lithium price will remain strong in the second half this year, but next year will be challenging,” as demand could be affected by the macroeconomic surroundings, he added.

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