Xiaomi has disappointing opening

Chinese smartphone maker Xiaomi opened 2.35 percent lower at HK$16.6 in its Hong Kong trading debut on Monday, compared with an indicative price range between HK$17 and HK$22 ($2.17 and $2.80) for a total of 2.18 billion shares on offer.

The Beijing-based company is the first to list in Hong Kong with a dual-class structure after the city revamped its rules for initial public offering to allow founders to keep outsized voting rights.

Hong Kong Exchanges and Clearing Limited said last week Xiaomi shares will be included in its designated securities eligible for short selling on the listing day, while Xiaomi futures and options will also be introduced.

Lei Jun, founder and CEO of Xiaomi, said starting trading at a lower price is not necessarily a bad thing for the company. He looked to the stock price in the long run and said what is most important is making Xiaomi better, according to a transcript compiled by wallstreetcn.com.

He said the 8-year-old company is keeping its focus on the European market, where it has moved to fourth place, and will not consider the US market in the near term.

Xiaomi decided to delay issuing CDR last month. After attending the listing ceremony, Lei said flotation both in Hong Kong and the Chinese mainland would not be good timing for Xiaomi.

Lei also said the company will issue CDR after appropriate operations in the Hong Kong market. "CDR is an important trial, and we must be on the safe side," he said.

Lei expressed confidence in a letter to employees published on Xiaomi's WeChat account Sunday, with investments from billionaires such as Li Ka-shing, Jack Ma and Pony Ma. And he said a successful listing is only the first chapter of Xiaomi's story.

According to the letter, more than 7,000 employees of Xiaomi will hold company shares or options, and the earliest venture capital investment of $5 million will grow 866 times in value.

Xiaomi share price rebounded to HK$16.98 in the morning session, with the peak price reaching HK$17.