Shares of RLX Technology, which sells vaping products in stores across over 250 cities in China, surge in their U S market debut, giving evaluation of 46 billion that made it bigger than heavyweights like Imperial Brands and Japan Tobacco.

The excitement can be partly explained.

The Sequoia back company has about 63% of the market and has managed to roughly double revenue for the nine months through September.

It's also proven itself to be quite nimble.

For example, it responded to 2019 crackdown on online E cig domestic sales by focusing on offline operations.

And it's not the only one benefiting from market exuberance.

Share is a Vape device manufacturer.

Hong Kong List.

It's more international have also soared over 500%.

Still, there are reasons to be wary deciding the largest market for tobacco consumption, Vaping is so relatively nascent in China, with penetration rates a just over 1%.

There's also been a wider global backlash towards vaping, and the jury's still out on the health benefits of these so called reduced risk products.

Altria, for example, initially took a 12.8 billion stake and Jewel Labs back in 2018, but has since had a series of writedowns and now says it's taken.

The company is worth 1.6 billion.

In China, the rules can change very quickly.

Investors can avoid blowback by pricing and regulatory risk.