Mainland investors starry-eyed about the listing of a homegrown tech company will be disappointed by Xiaomi Corp.’s decision to postpone the China half of its stock debut. You can expect moms and pops in Hong Kong to feel a bit deflated in turn. Without Chinese depositary receipts to stir interest, demand in the city will likely be more muted, too.

After nine rounds of pre-IPO funding, the Chinese smartphone maker is now the comeback kid, finally forging ahead with an initial share sale. Its Hong Kong IPO will raise between $4.7 billion and $6.1 billion before an over-allotment option is exercised, giving the company a possible valuation of $53.9 billion to $69.8 billion. With the plan to sell CDRs dropped for now, Xiaomi isn’t coming close to reaching that once-mooted figure of $100 billion.

Xiaomi can’t be blamed for putting its CDR ambitions on hold.

The rules surrounding this novel way to list foreign-owned tech firms in China are new, and complex. Their advent at short notice threw a spanner in much of the work already done by bankers who were preparing for the float.

Xiaomi’s prospectus, months in the making, had a uniquely Hong Kong touch and couldn’t meet all the requirements of a Chinese regulator wary of giving retail investors access to an unprofitable tech giant. The China Securities Regulatory Commission had some 84 questions for Xiaomi, an indication of just how onerous its demands were.

Beijing also stipulates that listing candidates provide profit forecasts (while Hong Kong doesn’t), and bankers are legally liable for the veracity of any sales document.​​​

A weak Chinese stock market may also be making regulators hesitant about individuals cashing out of safer stocks to buy blue sky.

For Xiaomi, a $53.9 billion valuation may be enough. It certainly seems to be for the four co-founders who are selling down as part of the float, along with Morningside Group, an early venture capital investor. Those who participated in Xiaomi’s later rounds may not be so impressed, particularly since the company was last valued at $46 billion in 2014.

Investors can at least rest assured this is a deal that’s garnered some state support, so while it may not soar, it won’t collapse either. Xiaomi has locked up firms including China Mobile Ltd. and China Poly Group Corp., as well as Qualcomm Inc., but the seven cornerstone investors, which will commit to holding their stock for 180 days, are only chipping in for about 10 percent of the total shares offered.

That’s a far cry from Postal Savings Bank of China Co., which in 2016 locked up 75 percent of its float.

Xiaomi co-founder and CEO Lei Jun, who will retain control via a weighted-voting rights structure, may take comfort in the spike in Hong Kong dollar borrowing costs, a sign there’s investor appetite for margin loans to buy into the deal.

But would-be punters will also be weighing misgivings about Lei’s outsized sway over the company’s future, as well as the fact its internet services division still plays second fiddle to smartphones. They’ll also have to decide whether an IPO price range of 22.7 times to 29.3 times forecast 2019 earnings — double Apple Inc.’s 14.9 times 12-month multiple — is worth it.

Of course, there is Xiaomi’s strong growth story in India, and the promise that profit in 2019 will be almost triple 2017. Perhaps Lei can transform Xiaomi into an internet giant comparable to Alibaba Group Holding Ltd. or Tencent Holdings Ltd.

Whatever the case, it’s certain that losing Chinese investors has taken the wind out of Xiaomi’s IPO sails.

To contact the author of this story: Nisha Gopalan at ngopalan3@bloomberg.net

To contact the editor responsible for this story: Katrina Nicholas at knicholas2@bloomberg.net

©2018 Bloomberg L.P.