The recent rise in Xipuni's stock price has not been primarily driven by changes in fundamentals but is highly correlated with the expectation of inclusion in the Shanghai-Hong Kong Stock Connect program.
Amid the fervent rally of new listings on the Hong Kong stock market, Xipuni (02583) has captured significant attention. Since its debut on the Hong Kong Stock Exchange at the end of September, this brand specializing in gold watches quickly became a market focus: surging 258% on its first day of trading, followed by another 71% rise on the second day. To date, its cumulative increase has approached 480%, propelling its market capitalization beyond HKD 10 billion, making it arguably the most dazzling 'star IPO' in Hong Kong's 2025 equity market.
Analysts have pointed out that Xipuni's recent surge has not been primarily driven by changes in fundamentals but is highly correlated with expectations of inclusion in the Shanghai-Hong Kong Stock Connect program. Its IPO structure, liquidity characteristics, and market cap trajectory bear similarities to the paths taken by some small-cap stocks in recent years to seek rapid inclusion in the Stock Connect mechanism shortly after listing.
Concentrated float, persistently low turnover rate
Xipuni's market performance post-listing is greatly related to its issuance structure.
According to its prospectus, the total number of shares offered globally was only 10.6 million, of which the portion reserved for public subscription by retail investors (Hong Kong offering) accounted for just 10%, or 1.06 million shares. This means that, at the moment of listing, over 90% of the shares were already locked in the hands of cornerstone investors, international placement institutions, and other 'key players.' Facing an overwhelming retail oversubscription rate of 2,505.9 times, these mere 1.06 million shares were instantly snapped up, leaving very few tradable shares available on the first day of listing.
This extreme '货源归边' (concentration of share supply) structure created a perfect environment for key players to manipulate the market. Unlike traditional stocks where accumulation takes time, they could easily drive up prices with relatively small amounts of capital on the first day of listing, achieving what is known as a 'violent lift.' As a result, the share price skyrocketed wildly in the first two trading days, while trading volume plummeted from 2.82 million shares on the first day to 620,000 shares on the third day, presenting a classic case of 'volume-price divergence.'
Zhitong Finance APP also noted that the company's current turnover rate hovers around 0.1%, further confirming that the 'frenzy' at the start of the listing was not driven by market consensus but rather by a 'resistance-free lift' under highly locked-in shares. Through minimal capital manipulation or order propping, an illusion of strong upward momentum in share price can be created, thereby attracting market followers.
Market capitalization management points to the review window for inclusion in the Shanghai-Hong Kong Stock Connect program.
The special attention given to Xipuni's market performance is inseparable from market expectations of its potential inclusion in the Shanghai-Hong Kong Stock Connect list.
According to Zhitong Finance APP, the adjustment of Hong Kong Stock Connect is divided into regular adjustments and temporary adjustments. Regular adjustments follow the Hang Seng Composite Index, occurring semi-annually at the end of June and December each year, with effectiveness in September and March respectively. Temporary adjustments are irregular and involve the inclusion or exclusion of stocks that do not meet the criteria. For new stocks to be included in Hong Kong Stock Connect, they generally enter through the regular semi-annual review process. Inclusion in Hong Kong Stock Connect can attract attention from mainland capital, significantly boosting trading volume. According to the rules, for a company to be included in Hong Kong Stock Connect, its average daily market capitalization in Hong Kong during a specified review period must exceed approximately HKD 9.4 billion.
According to Wind calculations, as of December 15, Xipuni's average daily market capitalization was HKD 9.848 billion, slightly above the current 'inclusion threshold,' and its monthly stock liquidity also fully met the requirements.
Interestingly, on December 16 during intraday trading, its market capitalization briefly fell below HKD 9.3 billion before recovering, hovering around HKD 9.4 billion—indicating a clear intention to 'stabilize market value.'
Zhitong Finance APP noted that the main net buyers on that day were UOB Kay Hian and ABN AMRO Bank, recording net purchases of approximately 1,900 and 1,800 shares respectively. These two brokers, being relatively smaller in scale, exhibited greater flexibility in their trading activities. Meanwhile, net sellers included well-known institutions such as Goldman Sachs and Huasheng.
This broker trading structure reflects, to some extent, the characteristics of 'stabilization' operations: large investment banks with high market credibility and diversified businesses focus more on their global portfolio strategies and market reputation, exercising relative restraint in their operations; whereas smaller brokers or dealers are more likely to act as conduits for executing specific short-term trades.
More notably, the rules for Hong Kong Stock Connect do not impose a minimum listing duration requirement for newly listed stocks. As long as they meet the market capitalization and liquidity thresholds during the review period, it is possible to achieve 'listing this quarter, inclusion next quarter.' This has led to the repeated occurrence of a 'fast-track inclusion' pathway among several newly listed stocks in recent years, showing highly similar patterns. On one hand, companies have yet to undergo a full quarter of performance verification, lacking institutional holdings and sell-side research report coverage, meaning their market capitalization and liquidity do not stem from long-term operational accumulation but rely on short-term capital inflows. On the other hand, the share prices of these related stocks often deviate significantly from fundamentals.
Against this backdrop, once certain individual stocks successfully gain inclusion, speculative funds that had been positioned in advance quickly cash out and exit. Coupled with subsequent underperformance or the release of negative information, the share prices generally experience cliff-like declines ranging from 30% to 90%. Ultimately, retail investors and southbound funds become the primary parties bearing losses, exposing significant vulnerabilities in the current Hong Kong Stock Connect inclusion mechanism regarding prudence and risk prevention.
Business scale grows, but customer concentration remains high.
From the perspective of the company's business operations, Xipuni is one of the leading gold watch brands in China, generating revenue primarily through sales of precious metal watches designed and manufactured under its flagship proprietary brand 'HIPINE (Xipuni).' According to data from CIC Consulting, Xipuni ranked as China’s largest gold watch brand in 2024 based on GMV (Gross Merchandise Volume), with a market share of 27.08%.
In fact, Xipuni’s journey to capital markets has not been smooth. Since 2016, Xipuni has experienced two listings and two delistings on the New Third Board before shifting its focus to the Hong Kong Stock Exchange, where it filed twice before finally succeeding in its IPO on September 30 this year.
Having secured a leading position in the domestic precious metal watch market, Chipin's financial performance has continued to fluctuate.
According to the prospectus data, the company's revenue from 2022 to 2024 reached RMB 324 million, RMB 445 million, and RMB 457 million respectively, showing year-on-year growth. However, revenue growth significantly slowed in 2024. During the same period, the company’s net profit was RMB 24.541 million, RMB 52.099 million, and RMB 49.348 million respectively, also reflecting a volatile trend.
Fortunately, this trend has somewhat changed since 2025. In the first five months of 2025, the company's revenue increased by 21.6% year-on-year to RMB 231 million, with its net profit reaching RMB 42.8 million, which already accounts for 86.7% of the total net profit in 2024. Nevertheless, such figures still lack solid support for the company’s current market capitalization of over HKD 10 billion.
Meanwhile, the company is also facing some practical challenges at the development level.
First, industry competition is mounting both internally and externally. Despite maintaining a leading position in the domestic gold watch market with a 24.98% sales share, the company still needs to fend off competitors in a concentrated market where the top five brands collectively hold 37.48% of the share. Moreover, it must compete against international luxury brands in the high-end segment, while contending with domestic traditional brands and smartwatch giants like Huawei and Xiaomi in the mainstream market.
Second, excessive customer concentration reflects significant dependency risks. From 2022 to 2024, the company’s sales revenue from its top five clients consistently exceeded 87%, with revenue from a single major client accounting for over 35% at its peak. This structure weakens the company’s bargaining power and makes its performance heavily reliant on a few customers’ operations, amplifying the volatility risk in business performance.
In summary, Chipin's case reflects the market capital’s attention towards new stocks, especially those with specific themes or institutional opportunities. Its market performance results from multiple factors, including but not limited to industry focus, the company’s own business positioning, equity liquidity during the initial listing phase, and potential funding expectations driven by the Stock Connect mechanism.
For investors, decision-making must be more prudent when dealing with such targets that combine high visibility with high volatility. While paying attention to market trends and institutional opportunities, it is crucial to conduct an in-depth analysis of the company’s long-term competitive capabilities, the sustainability of its financial condition, and the core risks associated with its main business.
