Stockbrokers, banks jockey to win over retail investors as order taking for Xiaomi’s blockbuster IPO gets underway
Global investors can submit orders for shares in the Xiaomi IPO from Monday through Thursday this week
Local stockbrokerages and banks are jockeying to attract business from retail investors seeking to get in on the share sale by smartphone maker Xiaomi this week, rolling out special discounts and fee waivers tied to the subscription drive for the US$6.1 billion IPO, the largest of its kind globally for two years.
Individual retail investors can become owners in the company for as little as HK$4,444.33 (US$566.32), representing a single lot of 200 Xiaomi shares, available during the subscription period which runs from Monday until Thursday.
Banks and brokers could be the biggest winners from the blockbuster offering. The Xiaomi initial public offering [IPO] could bring in commission income of HK$479.3 million among the more than 500 stockbrokers and banks involved, based on the assumption that they receive an average 1 per cent of commission and that the offering prices at the top end, raising HK$47.93 billion (US$6.1 billion).
Financial firms also stand to benefit from interest payments from investors who borrow on margin to subscribe to the IPO.
Xiaomi is the biggest IPO worldwide this year and the largest since the HK$59.15 billion listing by Postal Savings Bank of China in September 2016.