The shares of Wanda Cinema Line, China’s largest private sector movie theater chain, soared by 44% on Thursday in their stock market debut.
At the end of the first day of trading on the Shenzhen Stock Exchange the shares closed at RMB30.74, up from the RMB21.35 price at which they were listed. Trading was automatically halted at least once during the day as the stock reached its upper trading ceiling.
Wanda Cinema Line was spun off from parent Dalian Wanda group and remains majority controlled by the giant Chinese property to services conglomerate.
It operates 142 multiplexes in 73 cities in China, with a total of 1,247 screens, according to a regulatory filing. Revenue last year hit RMB3.16 billion ($515 million) with net profit revealed as RMB605 million ($98.5 million).
At the closing price, Wanda Cinema Line has a market capitalization of $2.81 billion (RMB17.2 billion). That is bigger than AMC Entertainment, the North American cinema chain that Wanda acquired in 2012 and refloated on the NYSE in late 2013.
The buoyant debut comes in contrast to the lackluster market entrée for Wanda Commercial Properties, which had an IPO in Hong Kong in December. And it follows a number of setbacks.
Wanda’s initial application to float Wanda Cinema Line was rejected by Chinese stock market regulators on the grounds of insufficient documentation. The company resubmitted its paperwork in November and received approval in December. But bumpy market conditions forced the company to cut back, to just $209 million, the amount of fresh capital it raised from the IPO and kept the initial stock price at the lower end of market expectations.