A major initial public offering will test Thailand's waning enthusiasm for new listings. Shares in Central Retail, Thailand's largest retailer, opened flat on their debut on Thursday, matching its issue price of 42 baht per share. Strong cornerstone investors helped it price near the top of its marketed range, although the economic timing couldn't be worse. Thailand's listing market has stayed hot even as secondary trading has cooled. One of these trends can't last.

The sprawling retail arm controlled by the billionaire Chirathivat family spans fashion, electronics, supermarkets and convenience stores across almost 2,000 stores in Thailand. The float priced well, valuing the company at around 260 billion baht ($8.3 billion), and was oversubscribed, due in part to its stable of top-notch cornerstone investors, including Capital Research Management and Singapore's sovereign wealth fund GIC. An active marketing campaign also helped.

The question is how it will perform over the next few months. Thailand was the hottest equity capital market in Southeast Asia last year, and the pipeline remains robust. But follow-on trade has been flagging. New listings in Thailand last year, including secondaries, now trade 16% below their offer price on average, according to data provider Dealogic. That is worse than the benchmark SET index, which is down around 5% since the beginning of 2019.

Thailand cut forecasts for economic growth this year to 1.5% to 2.5% this week, from 2.7% to 3.7% previously. The retail sector's recovery depends on how quickly Bangkok can convince shoppers it has the coronavirus under control; although Central Retail also has operations in Vietnam and Italy, its core business is primarily Thai.