Hong Kong and Shanghai locked in tight race to be 2020’s top IPO venue for Chinese issuers
- Hong Kong continues to attract US-listed Chinese companies seeking backstop listings, but Shanghai is drawing mega deals
- More Chinese companies are listing in their domestic market after reforms made the Shanghai bourse, and its tech board, more IPO-friendly
As the city gradually emerges from the coronavirus shutdown, the last three months stand as the lowest second quarter in terms of deal number since 2016, with just 22 IPOs completed. For the last six months, the Hong Kong stock exchange raised US$11.18 billion from 54 IPOs, up 23 per cent from a year ago in proceeds terms; but the number of deals fell 19 per cent.
There remains a big gap between Hong Kong and the second-ranking Shanghai Stock Exchange, which raised US$13.59 billion from 77 IPOs. The US exchange Nasdaq topped the global ranking, raising US$15.65 billion from 48 IPOs, data from Refinitiv shows.
Despite the collateral benefit that Hong Kong seemingly enjoys from Washington’s attempt to decouple Wall Street’s links with China, more secondary listings might not be enough to secure the global lead the Hong Kong stock exchange enjoyed during the bulk of the past decade. The Shanghai Stock Exchange is beckoning more IPOs amid Beijing’s push for companies to make more use of equity fundraising.