Chinese tech firms making IPOs in New York are calling on some wealthy friends to help them succeed as mainstream investors rapidly lose interest in the group. The modestly successful pricing and debut for security software maker Cheetah Mobile (CMCM 2.97%) comes as a small positive sign for the market. Cheetah relied on some big-name friends to help its listing succeed, including both controlling shareholder and smartphone sensation Xiaomi and leading Chinese search engine Baidu (BIDU -0.54%).

A flood of Chinese tech firms have rushed to make IPOs in New York after a window of strong investor sentiment opened in the second half of last year, ending a two-year downturn for the sector. But, that strong sentiment has rapidly faded in the last few weeks, leading companies to sharply pare back fund-raising targets and price offerings at the lower end of their ranges. To support its offering, Cheetah was reportedly calling on Baidu, Kingsoft, and Xiaomi to buy up to one-quarter of its IPO shares.

In the end, Cheetah raised $168 million in its New York listing, a far cry from its initial target of $300 million, and substantially less than its recently stated target of $200 million. The trio of Baidu, Kingsoft, and Xiaomi had reportedly committed to investing $50 million in the deal, meaning that Cheetah was only able to raise around $120 million from real investors without ties to the company.

Prices near top of range
On a more positive note, Cheetah was able to price its offering at $14 per American Depositary Share, or ADS, which was actually at the higher end of its previously stated range of $12.50-$14.50. Shares initially jumped as much as 17 % when trading began in New York, but rapidly faded and ended up a modest 0.7% at $14.10 on their debut day.

Baidu probably dumped most of its stake in Cheetah on the first trading day, though its investment was so small that perhaps the company will hold the shares a bit longer to show its support. Even if Baidu did hold the stake, it probably won't keep it for long since Cheetah's shares are almost certain to creep downward during its first few weeks of trading due to lagging investor interest in Chinese tech companies.

Another China tech IPO will hit the market on the final trading day this week, as online travel agent Tuniu makes its trading debut. The media has reported that Tuniu has set a price range of $9-$11 per ADS, and could raise up to $100 million through the offering.

Support from Ctrip
Like Cheetah, Tuniu's listing could also find an important supporter in leading online travel agent Ctrip, which was reportedly contemplating an investment in Tuniu's IPO as part of a strategic tie-up. If that investment comes, Tuniu's shares could be priced similarly to Cheetah's, in the middle-to-top of their range, and the stock could also post some small gains on its trading debut.

As for the bigger picture, the latest performance from Cheetah reinforces the view that the current IPO window for Chinese companies continues to narrow, and will probably close completely within the next week or two. Companies like Cheetah only managed to do respectably well thanks to strong third-party support from cash-rich friends. That could bode poorly for many of the current backlog of listing candidates, including online cosmetics firm Jumei.com, which could become the next company to make its offering and trading debut as early as this week.