SenseTime dives as much as 51% in Hong Kong after lock-up expires

SENSETIME Group slumped as much as 51 per cent in Hong Kong trading on Thursday (Jun 30), after a lock-up of its shares expired following its initial public offering. 

The company slumped to trade at as low as HK$2.91 apiece, the lowest ever and below its initial public offering price of HK$3.85. A lock-up on a portion of the company’s stock owned by the company’s cornerstone investors and shareholders expired on Wednesday. 

“SenseTime’s average liquidity looks very low, and it’s also subject to US sanctions. That means its investor base is probably more concentrated, so the impact of lock-up expiry is higher,” said Ling Vey-Sern, senior analyst with Union Bancaire Privee.

The Chinese artificial intelligence software maker joined a list of technology companies that have seen insiders selling their shares after a strong rebound since mid-March. This week, Tencent Holdings’ major backer announced it will further cut its stake in the company. In May, JD Health International’s controller Richard Liu sold his stake in the company. 

Selling pressure is not removed for SenseTime as another block of shares owned by its shareholders is set to expire near the end of this year, Bloomberg-compiled data shows. The stock has rallied 18 per cent since mid-April through Wednesday. BLOOMBERG