Hong Kong leads the worldwide IPO market since Sept

By Carol Zhong

Defying the intensifying protests which have harm town’s economic system from commerce to tourism, Hong Kong’s has led the world in preliminary public choices for the reason that begin of September.

The whole worth of first-time share gross sales on the Hong Kong inventory alternate since Sept. 1 is $7.9 billion, overshadowing Nasdaq Inc.’s $7 billion and $three billion on the New York inventory alternate, based on information compiled by Bloomberg. Anheuser-Busch InBev NV’s $5.eight billion IPO of its Asian unit and one other billion-dollar-plus deal contributed to the lead held by the Asian monetary middle.

“The market has been unstable and difficult this yr however we are actually in a great window for IPOs in Hong Kong, ” stated Alex Abagian, co-head of Asia Pacific fairness capital markets at Morgan Stanley. “We’re seeing a major quantity of high quality capital being deployed in the direction of good belongings, primarily corporations which can be market leaders of their sector.”

Whereas summers are sometimes quiet for first-time share gross sales in Hong Kong as bankers and traders go on holidays, the escalation of the pro-democracy protests and the commerce conflict between China and the US damped corporations’ enthusiasm additional this yr. The whole raised in IPOs plunged to $1.5 billion for the July-August interval from $11.6 billion a yr earlier, which was the busiest summer time on document with listings of China Tower Corp. and Xiaomi Corp..

Sentiment in Hong Kong’s main market circled as AB InBev revived its IPO plan for Budweiser Brewing Firm APAC Ltd. final month. The world’s second-largest providing this yr attracted Singapore’s sovereign fund GIC Pte Ltd., which dedicated $1 billion. The sale was priced on the backside of the marketed vary and AB InBev partially exercised a proper to extend the variety of shares bought. Two weeks later, Chinese language sportswear retailer Topsports Worldwide Holdings Ltd. priced its $1 billion preliminary share sale.

ESR Cayman Ltd., a logistics actual property developer, is about to boost $1.6 billion because it’s anticipated to cost its IPO on the center of a marketed vary, individuals acquainted with the matter stated earlier. That deal may very well be the second-largest transaction within the territory.

The rejuvenated momentum can be evident among the many retail traders within the metropolis. Some small-cap IPOs noticed heavy over-subscriptions and frenzied buying and selling of their debuts. Ascentage Pharma Group Worldwide attracted orders for 752 instances its preliminary retail tranche this week, whereas shares of software program developer 360 Ludashi Holdings Ltd. greater than tripled on Oct. 10 on its first day of buying and selling.

Elsewhere, WeWork referred to as off one of many yr’s most hotly anticipated IPO in New York final month. In Australia, Latitude Monetary Group Ltd. shelved what would have been the nation’s largest share sale this yr, citing worries about how the corporate would commerce on its debut. That was adopted by PropertyGuru Ltd.’s IPO withdrawal.

For the yr, Hong Kong’s bourse may nonetheless are available third and even fourth in first-time share gross sales, trailing the exchanges in New York and Shanghai. To date in 2019, town’s IPO volumes have dropped 43% from a yr earlier to $18.6 billion, information compiled by Bloomberg present.

The town may nonetheless expertise a late flurry, holding bankers busy, Morgan Stanley’s Abagian stated.

“On the again of the latest pick-up in exercise, we stay moderately optimistic for the remainder of the yr, with the approaching 5 to 6 weeks anticipated to be busy when it comes to IPOs and block trades,” he stated.

–With help from Zhen Hao Toh.