Shares of Shanghai MicroPort MedBot Group Co Ltd (MedBot) plummeted 5.4% in intraday trading on Tuesday, following the company's announcement of a placement of 34.7 million new H shares at HK$7.85 per share.

The dilutive effect of the new share issuance appears to be the primary factor driving MedBot's stock price decline. The placement of additional shares, representing a significant increase in the company's outstanding share count, typically leads to a downward pressure on the stock price as the existing shareholders' ownership is diluted.

While the company has not explicitly stated the intended use of the proceeds from the share placement, such capital raises are often utilized for purposes like funding business expansion, paying down debt, or supporting research and development initiatives. However, investors seem to have reacted negatively to the short-term dilutive impact on the stock.