Hong Kong to take third spot in IPO fundraising

Arita Peng and Bloomberg

Hong Kong will be the third largest initial public offering venue in terms of total funds raised in 2022, following a resurgence in IPO activity in the second half of the year, KPMG said.

The top two rankings are taken by the Shanghai Stock Exchange and Shenzhen Stock Exchange.

Many mainland firms delayed their listing plans considering the fluctuating stock market, said Louis Lau, the partner in capital markets advisory group at KPMG China.

Lau added that fundraising in the second half of the year accounted for 80 percent of the entire year's total, but it was difficult to raise capital amid interest rate hikes and global inflation.

KPMG forecasts that over HK$180 billion will be raised in Hong Kong from 90 deals next year, with over 120 firms already filing IPO applications, and more specialized technology companies will also seek to list under the proposed new rules.

Meanwhile, Ruqi Mobility, Chinese state-backed automaker Guangzhou Automobile's (2238) ride-hailing firm, plans a Hong Kong IPO as soon as next year to raise around US$200 million (HK$1.56 billion), Bloomberg reported.

Ruqi is joining a crowded field of Chinese ride-hailing companies seeking first-time share sales in Hong Kong, including Zhejiang Geely-backed Cao Cao Mobility and Tencent-linked T3 Mobility.

In other news, Sunshine Insurance, one of the largest IPOs of the year in Hong Kong, slightly fell in the gray market after only 13 percent of its shares were subscribed. Its shares were priced at HK$5.83 each, the bottom of the price range.

The insurer declined 0.343 percent to HK$5.81 on Futu Securities' platform and slipped by 0.51 percent to HK$5.8 on Bright Smart Securities' platform.