[ET Net News Agency, 27 September 2018] In terms of the proceeds raised, the Hong Kong
Stock Exchange (00388) will rise to the top IPO spot while the proceeds at Shanghai and
Shenzhen would rank after the top three venues, Hong Kong Stock Exchange, New York Stock
Exchange and NASDAQ by the end of the third quarter of 2018, according to Deloitte China.
The new listing regime that opens Hong Kong's bourse to pre-revenue biotech and weighted
voting rights companies as well as the market's ability to lure liquidity to jumbo
flotations are keys to Hong Kong's success in 2018.
While the momentum for new listings in the Mainland is to remain slow due to the market
reform in the fourth quarter of 2018, Hong Kong is well positioned to remain as the crown
jewel in the IPO race by the end of 2018.
However, the stronger U.S. dollar, escalating Sino-U.S. trade war, weakening Renminbi
and various Eurozone uncertainties will determine the final performance of Hong Kong's IPO
market in the last quarter.
Including companies planning to commence new stock trading from 27 September 2018,
Deloitte anticipates Hong Kong to see 158 IPOs raising approximately HK$243.4 billion by
the end of September 2018.
Both the number of new listings and proceeds are to surpass the 106 IPOs raising funds
of HK$85.7 billion in the first three quarters of 2017 by 49% and 184% respectively.
The far fewer new listings and reduced proceeds of the A-share market comprising the
stock exchanges in Shanghai and Shenzhen by the end of September 2018 contrasts with its
performance in 2017. The two exchanges are likely to close with a total 87 IPOs raising
RMB116.3 billion against 350 IPOs raising RMB176.0 billion in the first three quarters of
2017, indicating reductions of 75% and 34% respectively.
With a forecast of no huge offering in the market during the third quarter of 2018, the
Shanghai Stock Exchange is boosted by the IPO of Foxconn Industrial Internet to assume a
stronger position over its Shenzhen peers. The former bourse is to raise approximately
RMB77.5 billion while the latter would record IPO funds of about RMB38.7 billion.
Backed by a strong pipeline of over 200 IPO applicants and the market resilience in
supporting a large number of IPOs, Deloitte forecasts Hong Kong to have about 220 IPOs
raising approximately HK$300 billion in 2018. About 10 unicorn IPOs are expected for the
entire year. Another wave of new economy IPOs, the third weighted voting right listing and
IPOs from another five pre-revenue biotech companies are set to be the highlights in the
fourth quarter of 2018. (KL)