A worker in a Nongfu Spring facility in Hangzhou, East China's Zhejiang Province in February 2020 Photo: cnsphoto

Shares of Chinese bottled water giant Nongfu Spring soared in a record-breaking stock sale on the first day of its listing on the Hong Kong stock market, becoming one of the hottest IPOs in Hong Kong's financial history. 

The company's shares surged by 85.12 percent to HK$39.8 ($5.13) at opening on Tuesday morning, pushing its total market value to HK$392.7 billion. By 10:46 am, shares of Nongfu stood at HK$35.05, up 63.02 percent. 

The Zhejiang-based water giant, which is a popular brand in the mainland, offered 388.2 million shares at HK$21.5 each in Hong Kong. Seven percent of the shares will be sold in Hong Kong and the rest on global markets.

According to media reports, Nongfu's retail shares were overbought by a record-setting 1,147 times, making it the hottest IPO in Hong Kong's financial history.

The company has five cornerstone investors including New York hedge fund Coatue and Japan-based ORIX Group, normally not an active participant in China's capital markets. 

One factor that has caused the buying frenzy is the company's high profitability, with a net profit margin of 20.6 percent in 2019, compared with the single-digit profit rate of the overall soft drink industry in both China and abroad, according to statistics revealed by Nongfu. 

The hot market response to Nongfu's IPO is another sign that the Hong Kong capital market is roaring ahead with the help of mainland commercial giants, after the IPO of the Chinese mammoths like Alibaba and JD.com on the Hong Kong bourse setting off trading frenzy. It also shows global investors' confidence in China's consumer market, which is bouncing back after the successful control of the novel coronavirus.