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Published: 21:09, December 15, 2021 | Updated: 21:10, December 15, 2021
EY: Hong Kong to rank fourth in 2021 IPO fund raising
By Su Zihan
Published:21:09, December 15, 2021 Updated:21:10, December 15, 2021 By Su Zihan

Photo shows a view by the Victoria Harbour in Hong Kong, June 11, 2020. (LI GANG / XINHUA)

Hong Kong is expected to rank fourth in the world in terms of IPO capital raised this year, the accounting firm Ernst & Young said on Wednesday.

It is estimated that 94 companies will launch their initial public offerings in the city, raising HK$323.7 billion ($41.5 billion), a year-on-year decrease of 35 percent in the number of IPOs and a 19 percent drop in the amount of funds raised.

It is estimated that 94 companies will launch their initial public offerings in the city, raising HK$323.7 billion ($41.5 billion), a year-on-year decrease of 35 percent in the number of IPOs and a 19 percent drop in the amount of funds raised

The funds raised by the top 10 IPOs amounted to HK$188.3 billion, accounting for 58 percent of the total amount raised, with five IPOs coming from the return of China concept stocks and three from unicorn companies.

The introduction of regulations and measures this year has delayed the listing of companies in the relevant sectors, Ringo Choi, EY Asia-Pacific IPO leader, said. These companies are expected to catch up on opportunities in the first half of next year, he said, believing that market demand for financing in 2022 is still relatively optimistic.

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With 100 to 120 IPOs expected in Hong Kong next year, the city’s IPO market is likely to exceed HK$350 billion in terms of capital raised, again making it one of the top three markets in the world, Choi said.


However, it will be difficult for the Hong Kong stock market to raise HK$400 billion without the emergence of huge IPOs, he added.

According to the report, the number of A-share IPOs and the amount of capital raised this year are both at record highs, with the Chinese mainland and the SAR remaining the most active regions in the world, accounting for 25 percent of the number of IPOs and 28 percent of the capital raised globally.

With a series of reforms that include a new securities law, the improvement of the Shanghai Stock Exchange Science and Technology Innovation Board, the return of pilot red-chip stocks, as well as the launch of Beijing Stock Exchange, the mainland’s capital market is believed to be entering a new era, Choi said.

READ MORE: HK takes top slot in global IPO rankings

Choi said that with the return of China concept stocks and eligible weighted voting rights, new economy companies such as technology, media and telecommunications, as well as biotechnology and healthcare companies, are expected to be the main industries and growth engines for IPO financing in Hong Kong next year.

A total of 33 biotechnology and health companies have gone public in Hong Kong this year, ranking first in the number of IPOs and second in the amount of capital raised.


suzihan@chinadailyhk.com


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