Hong Kong could raise up to $300b via IPOs in 2019

PwC predicts 200 public offerings in 2019, including 170 on the HKEX’s mainboard.

Hong Kong’s could cement its top three ranking, and possibly retain its initial public offering (IPO) crown, as it is projected to rake in $250-$300b of proceeds, a report by PwC revealed.

The country’s IPO landscape could be supported by a healthy pipeline of approximately 200 companies lining up for floats in H2 2019, and PwC estimates that total fundraising may be well over $300b if global markets remain stable for the rest of the year.

Nine overseas enterprises have listed on the Hong Kong Stock Exchange (HKEX) in the first half of 2019, and another 31 overseas enterprises are in the IPO pipeline as Hong Kong continues to establish its position as the most important Asian IPO fund raising hub, PwC noted.

In H1 2019, there were a total of 84 new listings in Hong Kong, and total funds raised jumped 35% YoY to hit.

Also read: Hong Kong clinched $21.19b across 35 IPOs in Q1 2019

“There was a stronger performance on the mainboard, which recorded 78 IPOs and$69.4b of total fundraising. This is a significant increase of 42% in number of companies and 35% in funds raised,” PwC said. 

On the other hand, the report noted that there were only six new listings on the Growth Enterprise Market (GEM) board within the period, with total funds crashing 88% YoY $400m. PwC noted that the companies seeking IPO are mainly from industrial and retail, consumer goods & services industries.

According to Eddie Wong, partner of capital markets services at PwC Hong Kong, the strong demand for IPO fund-raising in Hong Kong is set to continue. “There are approximately 200 IPO applications being processed by HKEX, across both the mainboard and GEM,” he said.

Also read: China's Xinyi Energy raises US$465m in Hong Kong's second largest IPO so far

PwC predicts 200 IPOs in 2019, including 170 on mainboard, and noted that this level of activity will possibly see Hong Kong’s IPO market continue to thrive.

“Biotech companies IPOs will continue to remain active. We estimate that there will be approximately 10 successful listings on HKEX in 2019,” Benson Wong, entrepreneur group leader at PwC Hong Kong said. “With last year listing regulation reforms successfully diversifying the Hong Kong IPO market, we believe that looking at possible new sector listing regulation reforms in the near future could potentially further diversify Hong Kong’s capital market and create new opportunities to strengthen Hong Kong as the best financing platform in the region.”