RPT-UPDATE 2-Shampoo maker BaWang soars 35 pct in HK debut

* BaWang share rally bucks weaker trend in broad market

* IPO one of the most popular in HK so far this year

* A sign that appetite for IPOs may be returning

(Add details, comment, updates stock price)

By Donny Kwok

HONG KONG, July 3 (Reuters) - Shares in Chinese herbal shampoo maker BaWang International (Group) Holding Ltd (1338.HK) soared more than a third in its market debut on Friday, bucking a weaker broader market, in a sign of strong demand for consumer goods stocks. BaWang, which hired movie star Jackie Chan and pop singer Faye Wong to promote its products, sold 700 million shares at a price representing 18 times its estimated earnings for 2009.

The stock rose as high as HK$3.20 per share after opening at HK$2.95, compared with its initial public offering price of HK$2.38 with 773 million shares changing hand.

The IPO is the most popular in Hong Kong so far this year in terms of subscription among retail investors and analysts say the strong response could be a sign of a pick up in appetite for new listings.

BaWang's retail public offering portion was 446 times subscribed and the company priced its HK$1.67 billion ($213.6 million) IPO at the top end of the indicative range.

"That's the way the Hong Kong market functions; when something is hot everyone wants a piece of it," said Jackson Wong, investment manager with Tanrich Securities.

Analysts said BaWang's debut price was in line with expectations given weakness in the broad market .HSI, which was down 0.46 percent at midday and set for a fourth day of falls.

Friday's sell-off was triggered by disappointing U.S. jobs data that pummelled Wall Street shares [ID:nN02297873].

IPO DEMAND RETURNING?

IPO issuance in Hong Kong is down more than 70 percent so far this year but a stock market rally has prompted many companies to reconsider reviving listings that were put on hold last year.

So far in 2009, 14 companies have launched IPOs and raised about HK$19.2 billion (US$2.5 billion).

Demand for IPOs has heated up recently, especially for consumer goods-related companies on the mainland betting they will benefit as China's economy looks set to be among the first to recover from a global downturn.