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Monday, August 06, 2018, 18:35
HK defies market slump with record summer IPO haul
By Bloomberg
Monday, August 06, 2018, 18:35 By Bloomberg

Two bull statues are seen outside the Hong Kong Exchanges and Clearing in this undated photo. (PHOTO PROVIDED TO CHINA DAILY)

Hong Kong IPO bankers aren’t getting much of a break this summer.

The city’s market for initial public offerings is in the middle of its biggest summer on record, despite a slumping benchmark stock index and some high-profile disappointments. 

Firms pursued stock sales this year after Hong Kong Exchanges & Clearing Ltd approved the biggest change to its IPO rules in two decades

Companies including Xiaomi Corp and China Tower Corp have completed US$19.2 billion of first-time share sales since the beginning of June, according to data compiled by Bloomberg.

READ MORE: Boom-bust tells IPO tale amid HK easing, mainland tightening

That volume easily surpasses the previous record set in 2010, when companies raised US$13.4 billion in the three months through August, the data show. 

Firms pursued stock sales this year after Hong Kong Exchanges & Clearing Ltd approved the biggest change to its IPO rules in two decades, opening the door for tech companies with weighted voting rights as well as unprofitable biotech firms like Ascletis Pharma Inc.

While deals are getting done, the Hang Seng Index is trading down about 16 percent from its January high, which has forced companies to adjust their fundraising expectations.

The year’s two biggest IPOs – from China Tower and Xiaomi – priced at the low end of their marketed ranges.

The rest of the year looks like it’s going to be equally busy. Meituan Dianping, the Chinese restaurant review and delivery giant, plans to seek about US$6 billion after filing in June for a planned Hong Kong listing, people with knowledge of the matter have said.

ALSO READ: Red hot HK IPO market is cooling as retail buyers flee

It will be joined by several biotech firms including Innovent Biologics Inc, which is developing treatments for cancer and other ailments, and contract drug researcher Viva Biotech Holdings.

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