Hong Kong IPO proceeds expected to reach HK$200b

The number of new IPOs on the Hong Kong Stock Exchange ranked first in the world in the first half of this year, said an Ernst & Young report.

HKSE is expected to have 98 new IPOs in the first six months, a year-on-year increase of 44 percent, but the amount of capital raised will fall by 8 percent from the previous year to HK$50.3 billion, ranking fifth in the world.

However, the report estimates that the aggregate proceeds will reach HK$200 billion in the whole year, enough to make HKSE rise to the top three global destinations for IPOs.

Ringo Choi, EY Asia-Pacific IPO Leader, said the new listings are usually more active in the second half of the year and several large companies have already filed IPO applications with HKSE.

HKSE's new listing rules that took effect in April marked the start of Hong Kong stock market reform and the pilot program of H-share full circulation, launched by China Securities Regulatory Commission, also helped mainland companies to list in Hong Kong, according to EY.

Among the top ten IPOs, the fund raised by financial companies accounted for 44 percent, a significant drop from 77 percent last year, although it continued to lead.

Cross-border IPOs remained active, with 13 overseas companies listed in Hong Kong and HK$1.81 billion raised. Among the listed companies, nearly one third were from S&T, media and telecommunications industries. Singapore had eight companies listed in Hong Kong.

However, another study by consultancy PricewaterhouseCoopers said China's quickened reform of the A-share listing mechanism is set to lure more overseas listed unicorn companies back to the mainland capital market.