Hong Kong could break into the top three IPO destinations by year-end

Total fundraising proceeds could hit $250b.

A series of blockbuster technology, media and telecom (TMT) IPOs is expected to buoy Hong Kong from its fifth-place slump to finally break into the top three global IPO league with total funds raised at $250b, according to accounting firm KPMG.

“The implementation of new listing rules for emerging and innovative companies has driven market sentiment and attracted the attention of companies which were previously seeking US listings,” said KPMG China head of capital markets development group Maggie Lee.

Also read: US biotech firms seeking higher valuations rush to Hong Kong

The number of Main Board IPOs in 2018 H1 is expected to rise from 33 to 48 although total fundraising may fall 11% YoY to $46.8b as a result of a decline in average deal size which contracted from $1.58b to $980m. Notable IPOs in H1 include Ping An which raised $8.8b followed by lenders Jiangxi Bank and Bank of Gansu at $7.4b and $6.8b respectively.

On the other hand, the GEM is poised to end the first half of the year with $3.4b in proceeds, which represents a strong 31% increase.

Hong Kong currently trails behind New York, NASDAQ, Shanghai and the Frankfurt stock exchanges based on IPO proceeds on a half-year basis.



The introduction of Chinese Depository Receipts, a financial instrument availed by Chinese smartphone maker Xiaomi, is also set to provide a boost to the local bourse as it attracts overseas-incorporated tech giants to return to A-shares.

Also read: Xiaomi to postpone Mainland share offering

The Shanghai and Shenzhen stock exchanges are expected to raise a combined RMB 93.4 billion with 64 new listings, which is 26 percent less than the RMB125.4 billion (246 IPOs) recorded in 2017 H1.