In this June 19, 2018 photo, a JD.com Inc drone flies during a package delivery demonstration at the company's drone testing site in Xi'an, China. (QILAI SHEN / BLOOMBERG)

JD Logistics Inc surged in the Hong Kong Special Administrative Region’s gray market trading, after its initial public offering was more than 700 times subscribed by retail investors in the city’s second-largest float this year.

JD Logistics’ stock offering comes as sentiment in the city’s IPO market has cooled with the benchmark Hang Seng slumping into a correction in March

Shares of the delivery arm of the Chinese mainland e-commerce giant JD.com Inc rose to as high as HK$51.95 on an over-the-counter platform operated by Phillip Securities Group ahead of its Friday debut. That marks a 29 percent gain from its offering price of HK$40.36, which was at the lower end of its marketed range.

The retail tranche of the company’s US$3.2 billion share sale was 715.6 times subscribed, making it the third most popular IPO in the city with a size larger than US$1 billion, after offerings by Kuaishou Technology and Nongfu Spring Co. The Chinese mainland's video-streaming platform operator surged 161 percent while the bottled water producer jumped 54 percent on their debuts. JD Logistics’ institutional offer was about 11 times subscribed.

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JD Logistics’ stock offering comes as sentiment in the city’s IPO market has cooled with the benchmark Hang Seng slumping into a correction in March. About half of stocks that debuted between March and May fell on their first day of trade, while April saw just three listings, the least in nine months, Bloomberg-compiled data show.

JD Logistics attracted seven cornerstone investors to its offering, including SoftBank Vision Fund, Temasek Holdings Pte, Blackstone Group Inc and Tiger Global.