The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

By Hudson Lockett

HONG KONG, March 3 (Reuters Breakingviews) - Mixue 2097.HK has just put other bubble tea listings to shame. Shares in the chain from Henan province, which sells bubble tea, coffee and ice cream, shot up about 42% on their debut in Hong Kong on Monday — a stark contrast with rival Sichuan Baicha Baidao Industrial 2555.HK, which tumbled almost 40% when it came to market nearly a year ago.

So what’s the difference? For one, size. Baicha Baidao operates a respectable 8,000 stores, but that is small beans compared to Mixue’s 45,300 outlets, which outnumber even those of Starbucks SBUX.O and McDonald’s MCD.N globally and give it a legitimate claim to being the world’s largest food and beverage company. And like the Big Mac seller, Mixue’s franchisee model has enabled its expansion across Chinese cities of all sizes, providing a wider consumer base for its low-cost comestibles.

Another kind of retail has helped send Mixue’s shares through the roof: mom and pop investors in Hong Kong put in for more than 5,200 times the shares made available. The institutional tranche of the offer attracted 35 times the allotted stock. That suggests the IPO, which raised $444 million, may have left money on the table.

The company can perhaps be forgiven for not taking markets for all they’re worth. In September Beijing forced the country’s bubble tea makers to temporarily shelve IPO plans after a string of duds from the sector owing to concerns over China’s economic outlook.

Yet Mixue’s stellar debut is evidence that this cloud has lifted, and the company’s stock is clearly benefitting from hopes that China can finally deliver stimulus this year sufficient to trigger a rebound in consumption. That is no sure thing, but the combination of commericial scale and official support for growth in the year ahead clearly favour the company.

That same combination will be top of mind for Contemporary Amperex Technology's 300750.SZ bookrunners. The battery giant last month filed for its own Hong Kong listing that could raise at least $5 billion, per Reuters - and it has the growth prospects and technological bona fides necessary to bring in the foreign institutional investors who can make that fundraising target a reality, provided geopolitics don't get in the way.

If Mixue had flopped, doubts would have mounted about market confidence in China’s recovery that could in turn throw cold water on Hong Kong's warming IPO market. As things now stand, the biggest beneficiary of Mixue’s listing may end up being CATL.

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CONTEXT NEWS

Shares in bubble tea chain Mixue Group rose 42% early on their first day of trading in Hong Kong on Monday after the company raised $444 million from its initial public offering. The city’s retail investors subscribed for more than 5,200 times the shares made available, while the institutional tranche was 35 times covered, per Reuters.

(Editing by Antony Currie and Aditya Srivastav)

((For previous columns by the author, Reuters customers can click on LOCKETT/ hudson.lockett@thomsonreuters.com))