Advertisement
Hong Kong stock market
BusinessMarkets

Hong Kong IPOs: market shows glimmer of revival as three solid debuts in a week raise US$111 million

  • ‘Although the deals are small, the sentiment is improving,’ analyst says
  • Shanghai-based Autostreets surged as much as 66 per cent on its first trading day on Friday, following strong early-week debuts by Qunabox and EDA Group

Reading Time:2 minutes
Why you can trust SCMP
A woman checks her phone near screens displaying Hang Seng Index information outside Exchange Square,the home of the Hong Kong stock exchange, on January 23, 2024. Photo: Reuters
Jiaxing Li
Investor appetite for new share listings in Hong Kong shows signs of improvement amid a market rebound, with a series of recent IPOs (initial public offerings) registering strong performance – albeit on a small scale compared with the blockbuster deals the market is accustomed to.

Autostreets Development, a used-car dealer based in Shanghai, saw its stock price surge as much as 66 per cent from the offering price on its first day of trading on Friday, before closing up 27 per cent at HK$12.94. The IPO raised HK$153 million (US$19.6 million), with oversubscription of 433.34 times by local investors and 0.98 times by global funds, according to a stock exchange filing on Thursday.

Add in new listings by vending-machine company Qunabox Group on Monday and e-commerce supply chain player EDA Group on Tuesday, and three debutants this week raised a total of HK$868 million – the most since the week of April 22 when bubble-tea brand Chabaidao, the biggest IPO of the year, flopped.
Advertisement
The solid IPOs could provide a sentiment boost to other listing candidates in a market where debuts have wobbled and planned offerings have vanished amid the slowest start since 2009.

“The price-performances are all quite positive,” John Lee, vice-chairman and co-head of Asia country coverage at UBS, said at a media briefing this week. “Although the deals are small, the sentiment is improving.” The market still wants to see more big, representative deals, he added.

Advertisement

Proceeds from first-time stock offerings in Hong Kong fell 29 per cent in the first quarter to US$604.4 million, according to London Stock Exchange Group data. The city was the world’s top IPO destination seven times between 2009 and 2019, but saw its ranking fall two places to 10th during the quarter.

Advertisement
Select Voice
Choose your listening speed
Get through articles 2x faster
1.25x
250 WPM
Slow
Average
Fast
1.25x