Hong Kong IPO applications surge as many in China’s Silicon Valley keen, summit hears
- HKEX hosts summit to promote the new Chapter 18C listing regime in Shenzhen, dubbed China’s ‘Silicon Valley’
Shenzhen, widely considered China’s Silicon Valley, is brimming with technology companies eager to list in Hong Kong, where a stock exchange rule change has galvanised pre-revenue unicorns.
Hong Kong Exchanges and Clearing (HKEX), the bourse operator which runs the third largest stock exchange in Asia, is now handling 106 listing applications after 40 initial public offerings (IPOs) in the city this year. The numbers are a big jump over last year’s comparable period, which saw 73 applications and 31 IPOs.
“Hong Kong is the third largest IPO market worldwide this year in terms of number of deals,” said HKEX CEO Bonnie Chan Yiting on Thursday at the HKEX Future Tech Summit in Shenzhen. “We expected more to come, as many technology companies are preparing to file listing applications very soon under the new listing regime Chapter 18C,” she added, referring to a listing reform made last year that allows specialist technology firms to list even if they have yet to generate any sales.
Listing candidates in other sectors have to make at least a combined HK$80 million (US$10.2 million) of profit in the three years leading up to their share issue.
HKEX is promoting the Chapter 18C regime in Shenzhen after the exchange saw the first listing under the amended rules in June. Shenzhen-based QuantumPharm, an artificial intelligence (AI) drug researcher, raised HK$989.3 million in an IPO which was oversubscribed by 103 times.