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Hong Kong sees seven IPOs in one day

By Philip Smith

With 22 IPOs so far this year, HKEX is on track to remain a major centre for floatations

Hong Kong is set to remain one of the world’s major markets for initial public offerings (IPOs), with one estimate putting the amount to be raised this year via IPOs at HK$260bn (£25.6bn, $33.4bn, €30bn).

The Hong Kong Stock Exchange (HKEX) has had its busiest day for new listing in 18 months with seven companies ranging from a TV production company to a furniture maker making their trading debuts, raising HK$2.65bn.

It was mixed fortunes for the seven with three seeing gains while four ended the day below their IPO start price. The biggest IPO so far this year has been Chinese restaurant chain Jiumaojiu, which jumped 56 per cent on its debut.

In the past two weeks, the HKEX has seen 22 IPOs and accountancy firm PwC expects 180 firms to float this year with many coming from outside of the territory. The IPOs so far have raised only a small amount of money, said Jeffrey Chan, founding partner of investment firm Oriental Patron Financial Group. “Hong Kong will need to attract US-listed technology giants [and for them] to follow in the footsteps of Alibaba and have a secondary listing here,” he said.

Many see this large number of listings as proof that confidence in the Hong Kong market has not waned despite months of civil unrest in the region. “[These] 22 IPOs in two weeks and seven listings in a single day, are magnificent statistics given the political and economic circumstances,” said Edmond Hui, chief executive of brokers Bright Smart Securities. “It shows the strength of the Hong Kong capital market.”

FURTHER READING: IPO explained

FURTHER READING: Alibaba’s Hong Kong IPO is a big deal, here’s why

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