for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up

UPDATE 2-Longtop soars in US debut, year's best from China

(Recasts and updates that Longtop year’s best Chinese IPO in U.S., stock price)

NEW YORK, Oct 24 (Reuters) - China's Longtop Financial Technologies Ltd LFT.N shares soared in their U.S. stock market debut on Wednesday, the year's best by a Chinese company.

Longtop’s American Depositary Shares closed up 85 percent, making it the latest in a string of hot Chinese IPOs that have posted double-digit percentage gains in first-day trading on the Nasdaq or the New York Stock Exchange.

Longtop’s initial public offering priced at $17.50 per ADS on Tuesday, well above the forecast range of $12 to $14. The offering of 10.4 million ADS raised $184 million.

Longtop’s ADS closed at $32.40 on the NYSE on Wednesday.

The gain makes Longtop the best-performing Chinese IPO on a U.S. exchange year-to-date, and the second-best market debut overall, after Athenahealth ATHN.O, a U.S. Internet-based provider of administrative services to physician offices, which rose 97 percent in its September debut.

Longtop, based in Xiamen, China, provides information technologies services to China’s financial services sector. Its revenue grew to $16 million in the quarter ended June 30 from $10.9 million a year earlier. Net income dipped slightly, to $4.9 million from $5.1 million.

HOT SECTOR

The value of Chinese IPOs on U.S. exchanges has soared this year, up more than 500 percent from a year earlier, according to data tracker Dealogic.

The number of such IPOs is also way up, to 19 from three, with a half dozen more in the pipeline. It is the biggest year for Chinese IPOs since they first entered the U.S. market through American Depositary Receipt listings in the early 1990s, according to JP Morgan Chase & Co JPM.N.

Reception for the offerings has been wildly favorable.

On Tuesday, shares of Chinese jewelry maker Fuqi International Inc FUQI.O rose 16 percent in their U.S. debut.

Last week, Noah Education Holdings NED.N, which provides digital learning aides to China's primary and secondary school students, gained 40 percent in its first day of trading, and earlier in the month China Digital TB Holding Co Ltd STV.N posted an even stronger first-day rise of 75 percent.

The situation has led analysts to warn that Chinese offerings may be being valued too richly by investors eager to tap into the spending clout being wielded by China’s rapidly growing middle class.

But some offerings, such as Longtop, deserve investor favor, according to Scott Sweet, managing director of research firm IPOboutique.com.

"Longtop Financial is very much like the large U.S. consulting firms -- Accenture Ltd ACN.N, IBM Global Services IBM.N and BearingPoint Inc BE.N -- that provide advice and support to some of China's largest banks," he said.

The company is active in two-thirds of China’s provinces, helping to bring the nation’s burgeoning financial services sector up to speed on the technology front, he said.

“There also has been justifiable evidence of a Chinese bubble in the IPO market,” said Sweet. “In my strong opinion, the bubble does not burst here” with Longtop. (Additional reporting by Kristina Cooke)

for-phone-onlyfor-tablet-portrait-upfor-tablet-landscape-upfor-desktop-upfor-wide-desktop-up