Shenzhen Longsys Electronics Co’s shares fell in Hong Kong on Tuesday after the company raised HK$7.08 billion ($903 million) in an upsized share sale that’s testing the resilience of investor enthusiasm after a flurry of artificial intelligence supply chain offerings in the city.

The shares declined as much as 1.5 percent to HK$232.40 from the IPO price of HK$236 apiece before paring some of those losses. Longsys, one of the world’s largest independent memory-module makers, sold about 30 million shares priced at a 44 percent discount to its previous closing price in Shenzhen, where the company been listed since 2022. The company’s market value slipped to about HK$189 billion ($24 billion).

The debut is a test of investor sentiment over fast-changing memory prices and the durability of the AI infrastructure buildout, even as DRAM and NAND pricing has surged this year on tight supply.

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The Hong Kong Special Administrative Region’s booming market for first-time listings has raised more than $45 billion, making the 2026 the third-best year on record already. The 10 deals of Longsys’ size or bigger result in a weighted average first-day gain of roughly 5 percent, according to data compiled by Bloomberg. More than half of those stocks are now trading below their offering price.

“As a result of strong AI demand, DRAM allocation to module makers is likely to decline in 2027. Longsys has roughly doubled its supplier prepayments over six months in anticipation of this crunch,” said Rolf Bulk, head of semiconductors and infrastructure at The Futurum Group.

Cornerstone investors — which get guaranteed allocation in the deal in exchange for holding the stock for at least six months — bought 18.89 percent of the offering. They include Transsion International Ltd, an indirect unit of Shanghai-listed Transsion Holdings Co, CITIC Securities Asset Management, and Lens Technology HK.

The listing price also implies a 61 percent discount to a 3.7 billion-yuan ($551 million) placement in early August at 560 yuan per share. Chinese mainland mutual funds including E Fund Management Co Ltd and China Asset Management Co Ltd took part in the placement, subject to a lock up of six months, according to Bloomberg.

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Bulk added that with H-shares making up only about 6 percent of total capital and cornerstone investors taking roughly 20 percent of the allocation, the tradeable float is small, a dynamic likely to produce sharp swings in either direction once trading begins, largely tracking the broader global memory trade.

Longsys plans to use the proceeds to support research and development in chip design and advanced memory technologies. Its revenue more than doubled to 24.1 billion yuan in the first half of 2026, while net profit jumped more than 700-fold to 10.6 billion yuan as memory prices climbed.

CITIC Securities Co and Citigroup Inc are joint sponsors for Longsys’ listing.