HONG KONG, Dec 2 (Reuters) - Shares of Evergrande Property Services fell marginally on their Hong Kong debut on Wednesday, shedding initial gains as the spinoff of China’s second-largest property developer struggled to shake off worries about debt and competition. Concerns about the financial health of its parent, China Evergrande Group, have clouded Hong Kong’s third-largest listing of the year, with China’s most indebted developer planning to use half the $1.8 billion raised for its own debt repayment. The stock opened at HK$8.84 per share, a 0.45% premium to the HK$8.80 initial public offer price, but closed 0.2% lower at HK$8.78. It fell as much as 3% during the session. Shares of China Evergrande fell 2.5%, while the Hong Kong market was down 1%. “There are simply too many property management companies already listed,” said Dickie Wong, executive director at Kingston Securities. “(The) mother company’s net gearing ratio is simply very high.” There have been 15 property service deals in Hong Kong this year, raising a total of $7.2 billion, compared with $1.67 billion in 2019 and $1.4 billion in 2018, according to Refinitiv data. More recent listings in the sector have struggled, with KWG Living losing 23% and Shimao Services and First Service dropping 23% and 27%, respectively, on their first days of trade in October, Refinitiv data shows. Bigger rival Sunac Services, however, gained 22% in its debut on Nov. 19. Investors’ response to Evergrande Property Services’ IPO last week was lukewarm with the stock pricing near the lower end of the HK$8.50 to HK$9.75 per share range, undermined by concerns about the high debt level of its parent. Thomas Kwok, head of equity business of CHIEF Securities, said the market is concerned about the parent company and the prospects of restructuring. China Evergrande has been scrambling for cash as Beijing tackles what it considers excessive borrowing in the real estate development sector with planned new debt-ratio caps. In an attempt to improve cashflow, Evergrande, whose borrowings totalled $124 billion, has also recently sold secondary shares and agreed with strategic investors of a now-terminated Shenzhen backdoor listing to not demand repayment. (Additional reporting by Clare Jim; Editing by Sherry Jacob-Phillips, Sam Holmes and Louise Heavens)