Hong Kong edges past Nasdaq as the world’s third-quarter IPO hub as companies returned to one of Asia’s deepest markets for funds

The total value of first-time share sales in Hong Kong since September 1 is US$7.9 billion, overshadowing Nasdaq’s US$7 billion and US$3 billion at the New York Stock Exchange, according to Bloomberg

Anheuser-Busch InBev NV’s US$5.8 billion IPO of its Asian unit and another billion-dollar-plus deal contributed to the lead held by the Asian financial centre

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A ceremony at the Hong Kong stock exchanges to welcome the first trading day of the Lunar New Year on February 8, 2019. Photo: Xinhua

Published: 11:43am, 28 Oct 2019Updated: 11:43am, 28 Oct 2019

Hong Kong’s IPO market is making a huge comeback.

Defying the intensifying protests that have hurt the city’s economy from trade to tourism, Hong Kong’s has led the world in initial public offerings since the start of September.

The total value of first-time share sales at the Hong Kong stock exchange since September 1 is US$7.9 billion, overshadowing Nasdaq’s US$7 billion and US$3 billion at the New York Stock Exchange, according to data compiled by Bloomberg. Anheuser-Busch InBev NV’s US$5.8 billion IPO of its Asian unit and another billion-dollar-plus deal contributed to the lead held by the Asian financial centre.

“The market has been volatile and challenging this year but we are now in a good window for IPOs in Hong Kong, ” said Alex Abagian, co-head of Asia-Pacific equity capital markets at Morgan Stanley. “We are seeing a significant amount of quality capital being deployed towards good assets, primarily companies that are market leaders in their sector.”

World’s top IPO centres as of September 27, 2019. Source: Refinitiv. SCMP Graphics

While summers are typically quiet for first-time share sales in Hong Kong as bankers and investors go on holidays, the escalation of the pro-democracy protests and the trade war between China and the US damped companies’ enthusiasm further this year. The total raised in IPOs plunged to US$1.5 billion for the July-August period from US$11.6 billion a year earlier, which was the busiest summer on record with listings of China Tower and Xiaomi.

Sentiment in Hong Kong’s primary market turned around as AB InBev revived its IPO plan for Budweiser Brewing Company APAC last month. The world’s second-largest offering this year attracted Singapore’s sovereign fund GIC, which committed US$1 billion. The sale was priced at the bottom of the marketed range and AB InBev partially exercised a right to increase the number of shares sold. Two weeks later, Chinese sportswear retailer Topsports International Holdings priced its US$1 billion initial share sale.

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