Under the vigorous support for innovative technologies, Hong Kong welcomes its first special technology company listed under Chapter 18C of the Listing Rules. Although the IPO activity in Hong Kong has been slow starting in 2024, there are indications that the IPO market is expected to pick up in the second half of the year.
According to a report, the total global IPO fundraising in the first half of this year reached $51.6 billion, with a total of 513 transactions, marking a decrease of approximately 20% compared to the same period in 2023 in terms of fundraising amount and quantity. Despite the positive performance of the IPO market in the United States, the overall IPO activity remains soft due to a slowdown in the Asia-Pacific region. The IPOs on the New York Stock Exchange and Nasdaq ranked first and second globally in terms of fundraising, while the Shanghai Stock Exchange and the Shenzhen Stock Exchange fell to the fourth and fifth positions. The three largest IPOs globally were all conducted on stock exchanges in Europe, with fundraising amounts ranging between $2.4 billion and $2.8 billion per offering.
KPMG stated that geopolitical tensions and uncertainties such as multiple major elections globally this year continue to impact the global IPO market. However, there are slow signs of recovery emerging in certain IPO markets.
In the first half of 2024, the A-share stock market recorded a total of 52 new listings, raising RMB 56.5 billion, a decrease of around 75% in fundraising amount and 70% in quantity compared to the same period in 2023. Liu Dachang, KPMG’s Partner in the Chinese capital markets, mentioned that due to tighter regulations, the IPO activity in the A-share market slowed down in the first half of 2024, with a significant increase in the proportion of listings from the semiconductor and robotics production industries.
Meanwhile, Hong Kong’s IPO market saw 27 new listings, raising HKD 11.6 billion, marking a year-on-year decrease of 35% in fundraising amount and 15% in quantity. The fundraising total for the technology, media, and telecommunications (TMT), consumer goods, and healthcare and life sciences industries were HKD 4.6 billion, HKD 2.8 billion, and HKD 1.5 billion, respectively.
Zhu Yayi, KPMG’s Partner in charge of the China New Economy Market and Life Sciences industry in Hong Kong, mentioned that due to five new measures introduced by the China Securities Regulatory Commission and the increasing interest of A-share applicants to list in Hong Kong, there has been a significant rise in IPO applications in Hong Kong, indicating a positive signal for the rebound of the Hong Kong IPO market. Based on these factors, optimism remains high for the revival of IPO activity in the second half of 2024.