OpinionCoronavirus paves way for online IPOs
- The outbreak – and the need for social distancing – has given paperless initial public offerings and e-roadshows a serious push, and the new practices should be actively encouraged
The coronavirus pandemic has changed the way many companies conduct business – with some practices, perhaps permanently. Among these are paperless initial public offerings and e-roadshows. Hong Kong has been slow to adopt both, but things are changing. The viral outbreak – and the need for social distancing – has given it a serious push. The new practices should only be encouraged.
The need for e-IPOs was brought home in the most threatening way in March when a guest who attended the listing ceremony of SG Group Holdings at the Hong Kong stock exchange tested positive for the coronavirus.
The incident triggered tracing and testing of other participants at the ceremony, which celebrated the apparel producer moving from the smaller GEM board to the main board.
Meanwhile, InnoCare Pharma this week became the first company to complete its HK$2.2 billion (US$289 million) IPO process – from road show for investors to the actual commencement of trading – entirely online. The Beijing-based cancer drug developer’s e-IPO was almost 300 times oversubscribed and pricing was at the high end of the asking range.
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Hong Kong, the world’s largest market for IPOs for the seventh year out of 11, typically marks every trading debut with the ceremonial striking of a metal percussion instrument, similar to the ringing of the bell on the New York Stock Exchange.