FINANCIAL SERVICES | Staff Reporter, Hong Kong

Can back-to-back blockbuster IPOs live up to the hype?

Despite being oversubscribed, shares of tech startups have struggled to deliver on their promise.

Bloomberg reports that although Hong Kong is set for a busy year ahead with the back-to-back mega listings of smartphone maker Xioami and phone tower operator China Tower that could raise $10b each, the history of recent global IPOs shows that recent public debuts have failed to live up to the hype after delivering meager returns. 

Amongst recent popular IPOs, China Literature Ltd. is down more than 30% from its peak whilst Razer Inc., Yixin Group Ltd. and ZhongAn Online P&C Insurance Co. are all down more than 40% from their respective highs.

Also read: Ping An's widely anticipated debut fails to live up to the hype

China Tower's stock has all the markings that investors will screen for its bond-like properties including low volatility or the prospect of higher dividends. However, rising bond yields make these stocks less attractive to income-seekers.

Also read: Blockbuster IPOs set to trigger cash crunch

Recent trends in the equity market don’t bode too well for Xiaomi either as shares of China’s tech startups that have gone public in the past year have struggled, even though their IPOs are multiple times oversubscribed.

Here’s more from Bloomberg

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