Since 2024, the number of IPO applications submitted by enterprises to the Hong Kong Stock Exchange has been on the rise, and the Hong Kong IPO market is expected to recover further.
According to the information of the Hong Kong Stock Exchange**, as of February 20, a total of 28 companies have submitted their applications to the Hong Kong Stock Exchange since 2024, of which 14 have been in January and 14 so far in February.
Among the 28 companies submitted to the Hong Kong Stock Exchange in 2024, almost all of them are mainland enterprises. In fact, in recent years, mainland enterprises have been the "main force" in the Hong Kong stock IPO market. According to the information of the Hong Kong Stock Exchange, among the 5 companies listed on the Hong Kong ** market in 2024, 4 companies are based in the mainland, and the total IPO fundraising amount is 15HK$400 million.
Industry insiders believe that the recovery of IPO applications in Hong Kong is not only due to the recovery of the global economy, but also inseparable from the efforts made by the Hong Kong Stock Exchange and regulators in improving market transparency and regulatory efficiency.
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In recent years, mainland enterprises have increasingly become the "main force" in Hong Kong's IPO market.
According to data from the Hong Kong Stock Exchange, a total of 73 companies will be listed on the main board of the Hong Kong ** market in 2023, of which 68 will be listed through initial public offerings (IPOs), 2 will be listed through introduction, and the other 3 will be transferred from the GEM market to the main board. Among them, 65 enterprises from the mainland came from.
In addition, since 2024, there has been an increase in the number of companies that have switched from A-shares to Hong Kong stock listings, and there are currently four mainland companies that have applied for listing on the Hong Kong Stock Exchange after "stopping" A-shares.
Specifically, Jinko Electronics tried to list on the Science and Technology Innovation Board in 2019, but withdrew its application materials in less than half a year. In addition, Huahao Zhongtian and Taimei Medical, which submitted applications on the Hong Kong Stock Exchange on the same day, also sought to be listed on the Science and Technology Innovation Board. Among them, Huahao Zhongtian withdrew the listing materials in May 2023 after two rounds of inquiries; Taimei Medical was rejected in March 2023 in the review process of the Listing Committee.
The catering brand "Mixue Bingcheng", which has attracted much attention in the market, announced its A-share prospectus in 2022 and plans to be listed on the main board of Shenzhen. However, after the implementation of the full registration system in 2023, Mixue Bingcheng did not participate in the translation declaration.
Some companies have turned to the Hong Kong market for IPOs, which have relatively few restrictions on financing.
Benefiting from the Hong Kong Stock Exchange's inclusive listing policy for biotech companies and the vigorous development of the global innovative pharmaceutical market, as well as the impact of the phased tightening of A-share IPOs, more and more innovative pharmaceutical companies choose to list in Hong Kong.
Among the companies submitted to the Hong Kong Stock Exchange this year, there are 7 biomedical track companies, including Zhejiang Tongyuankang Pharmaceutical Co., Ltd., Hangzhou Jiuyuan Genetic Engineering Co., Ltd., etc.
The listing of pre-revenue and profitable biotech companies in Hong Kong has also attracted much attention from the market. Since the commencement of Chapter 18A, a number of pre-profit biotech companies have been listed on the Main Board of the Hong Kong Stock Exchange.
According to market statistics, by the end of 2023, a total of 63 unprofitable biotech companies were listed in Hong Kong, raising a total of 1,202 IPO fundsHK$500 million, accounting for all newly listed healthcare companies in Hong Kong in the past six years (2649.).HK$400 million).9%。
Some people in the industry believe that the rules for allowing unprofitable biotechnology companies to list in Hong Kong will continue to play a role in the future to attract more companies to list in Hong Kong.
A person from a Shanghai investment bank said that the listing of pharmaceutical companies in Hong Kong not only provides investors with more diversified investment options, but also further enhances the popularity of Hong Kong's capital market in the global field of innovative pharmaceuticals.
In 2023, HKEX will add a new Chapter 18C to the Main Board Listing Rules, which will particularly benefit new specialist technology companies, including those in the fields of next-generation information technology, advanced hardware, advanced materials, new energy and energy conservation and environmental protection, new food and agricultural technology, so that they can apply for listing on the Hong Kong Stock Exchange with a lower market capitalisation and R&D expenditure ratio.
In November of the same year, HKEX published a revised guidance letter to allow existing shareholders (including pre-IPO investors) and underlying investors of a new applicant to subscribe for or purchase new shares in the IPO under certain specified conditions, i.e. "dual participation". On the 22nd of the same month, the IPO settlement platform of the Hong Kong Stock Exchange FINI was officially launched, and the time from pricing to the commencement of trading of new shares was shortened from five business days to two business days, which greatly reduced the risk of ** changes in new shares before listing, and also improved the overall operational efficiency of the market.
On January 31 this year, at the "2024 Hong Kong Capital Market Forum", Hong Kong Financial Secretary Paul Chan Mo-po said that the Hong Kong government is currently actively discussing with relevant mainland regulators to speed up the progress of approving enterprises to list on the Hong Kong Stock Exchange. At the same time, he stressed that he was in close consultation with the Mainland regulators to expedite the relevant work, with a view to attracting more high-quality Mainland and international enterprises to list and raise funds in Hong Kong.
With various measures, Hong Kong's IPO market is expected to gradually recover in 2024. Deloitte, a consulting agency, said in the "Chinese Mainland and Hong Kong IPO Market 2023 Review and 2024 Outlook" that it is optimistic about the performance of Hong Kong's new market in 2024.
In the report, the agency pointed out that when funds from Europe, the United States and the Middle East are redeployed to Asia, with a number of new capital market regimes, reforms and marketing promotions that have been introduced by the Hong Kong Stock Exchange, and the Hong Kong Special Administrative Region's measures to promote market liquidity and are expected to help increase market valuations, Hong Kong's new market will soon become active and strong again.
KPMG also pointed out in its 2024 Hong Kong IPO Market Outlook report that Hong Kong will usher in a series of strategic listing reforms in 2023, such as the introduction of Chapter 18C for Specialist Technology Companies, which will help increase the interest of various Specialist Technology Companies in listing in Hong Kong. The GEM listing reform will provide new financing options for high-growth and high-quality start-ups and SMEs in Hong Kong and the Greater Bay Area, thereby enhancing the attractiveness of GEM and in line with Hong Kong's commitment to supporting the development of SMEs.