Hong Kong’s stock market is experiencing a remarkable surge in initial public offerings (IPOs), with three new listings debuting on Monday and seven others opening for subscription.
Thai coconut-water maker IFBH and Beijing-based artificial intelligence service provider Unisound made significant jumps on the first trading day, adding 42.1 percent and 44.6 percent respectively over their IPO prices. Meanwhile, Ted Pharmaceutical closed at HK$30.8 ($3.92) on its debut, a modest 0.7 percent above its IPO price.
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The Hong Kong Exchanges and Clearing Ltd (HKEX) has already raised $44 billion in total equity financing this year, including $14 billion from IPOs, ranking first globally among all exchanges, according to data from the HKEX. The first-half IPO proceeds on Hong Kong's stock market now stand above the full-year fundraising amounts recorded in each of the previous three calendar years.
From June 23-29 alone, the HKEX saw 31 listing applications, three approvals, nine active offerings, and eight new listings.
Notably, on June 27, the HKEX received applications from 16 companies seeking to list on the main board, highlighting the growing confidence in the market. Among the 16 listing applicants, five are already A-share listed companies pursuing dual primary listings in Hong Kong, while the remaining applicants represent a strong technology-sector presence with 10 firms, followed by four healthcare companies, one food and beverage business, and one outdoor consumer goods provider.
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Deloitte, one of the "Big Four" accounting organizations, has forecast that Hong Kong may reclaim its position as the world's top IPO destination this year, with technology and healthcare firms driving activity.
Robert Lui, leader of Hong Kong’s capital market services group of Deloitte China, said that Hong Kong's IPO market is gaining momentum. This is driven by the mainland’s policies encouraging leading enterprises to list in Hong Kong, along with streamlined regulatory approval processes, improving market valuations, and rising trading liquidity, he added.
Edward Au, manager partner of the southern region of Deloitte China, stated that Hong Kong's IPO market is well-positioned to achieve higher fundraising levels and maintain its leadership position this year, provided there are no major macroeconomic disruptions.
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Additionally, from June 30, the HKEX has implemented a revised fee structure for stock trading to enhance market efficiency, eliminating the previous limits of a minimum fee of HK$2 and a maximum of HK$100. Fees are now standardized at 0.0042 percent per transaction. This move reflects the exchange's commitment to optimizing its securities market and attracting more issuers and investors.
