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Monday, June 08, 2020, 18:54
HK share sale bonanza on track as JD is oversubscribed
By Bloomberg
Monday, June 08, 2020, 18:54 By Bloomberg

The flag of the Hong Kong Special Administrative Region, right, flies alongside the Chinese national flag outside the Exchange Square complex, which houses the Hong Kong Stock Exchange, in Hong Kong, China, on Friday, May 29, 2020. (LAM YIK / BLOOMBERG) 

Chinese mainland’s No 2 online retailer JD.com Inc’s Hong Kong share sale of as much as US$4.1 billion is multiple times oversubscribed by institutional investors, people familiar with the matter said, as the financial hub enters a second week of multi-billion dollar stock offerings.

JD’s offering is set to be the world’s second-biggest this year and comes on the heels of mainland Internet company NetEase Inc’s $2.7 billion share sale in the special administrative region last week

JD’s offering is set to be the world’s second-biggest this year and comes on the heels of mainland Internet company NetEase Inc’s $2.7 billion share sale in the special administrative region last week.

After a muted start to the year in terms of initial public offerings due to the coronavirus pandemic and volatile markets, Hong Kong is roaring back to life with a slew of stock offerings.

ALSO READ: JD seeks US$4.1 billion in year's biggest Hong Kong listing

The highly sought after share sales have helped drive a surge of capital inflows, with the city’s currency climbing to the strong end of its permitted trading band late last week even as concern about looming national security legislation has spurred speculation about outflows.

Prior to NetEase last week, just US$3.5 billion had been raised through IPOs in Hong Kong, which was the world’s busiest listing venue last year. This week is set to beat that tally easily with JD, which is due to price on Thursday US time, while China Bohai Bank Co is planning to launch its own US$2 billion IPO later in the week.

ALSO READ: Mainland online mall JD.com files for HK second listing

Escalating tensions between Washington and Beijing are increasing risks for mainland companies like JD and NetEase that are seeking to broaden their investor base. Their Hong Kong listings follow Alibaba Group Holding Ltd’s US$13 billion stock sale last year, hailed as a homecoming for mainland companies and a win for the special administrative region’s stock exchange.

The city lost many of the largest tech corporations to US bourses because it didn’t allow dual-class share voting at the time -- a requirement that’s since been relaxed.

READ MORE: JD.com, NetEase 'win Hong Kong approval for listings'


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