Hong Kong Stock IPO "Semi Annual Report": New Economic Enterprises Get Together, Stock Market Giant Two Listing To Raise The Amount Of Financing

Driven by the two listing of new and economic enterprises such as technology and health care companies, the IPO financing of the Hongkong market has not risen against the background of the epidemic.

According to Ernst & Young's report in late June, a total of 59 companies were listed on the Hongkong market in the first half of 2020, raising the amount of HK $87 billion. Among the top ten IPO, 8 come from the health, science, technology, media and communications industries belonging to the new economy, accounting for 94% of the total.

Hongkong's market has become one of the preferred destinations for new economic companies to list, benefiting from the HKEx's new deal that allowed the right to share and unprofitable biotechnology companies to be listed in 2018. Under the dual influence of Sino US relations uncertainty and the trust crisis of China's stock market, the enthusiasm of new economic enterprises to go public in Hong Kong continues to heat up.

Huang Peihao, head of Asian equity division of UBS's equity capital market, believes that more new economic enterprises will be listed on the main board of Hongkong in the second half of 2020. Among them, the first half of the new economic enterprises IPO concentrated in the field of medical and biological technology, the plate will continue to have high-quality enterprises in the second half of the listing.

In the eyes of market participants, as more new economic companies are listed in Hongkong, the Hong Kong stock market will change the industry structure dominated by the traditional economy such as finance and real estate.

New economic enterprises get together

In the context of slowing global IPO activity under the influence of the new crown pneumonia epidemic, the mainland and Hongkong markets are less affected by the epidemic, and the new economic enterprises in Hongkong's capital market are still on the market.

According to Ernst & Young's data, a total of 412 companies were listed in the first half of 2020, raising a total of $66 billion 700 million. The mainland and Hongkong are less affected by the new crown pneumonia epidemic. IPO activity has maintained an increase compared with the same period last year, accounting for 43% and 46% of the global IPO and financing.

In recent years, the Hong Kong stock market performance of the company, in June 29th, cancer medical group Hai Ji ya, minimally invasive surgical instruments and accessories platform KINGE medical listed on the Hong Kong stock exchange, the first day closing share price rose 40.54% and 98.85% respectively.

Since June this year, companies that have submitted applications for listing in Hong Kong include Chao Matsu company, bubble Matt, biochemical pharmaceutical company, pioneer pharmaceutical company, short video marketing program service provider Netjoy, e-commerce solutions provider Eugene Hui, biopharmaceutical enterprise Jiahe biology and so on.

According to the data of Huaxing securities, the market share of new economy in Hongkong market has increased from 23% to 26% in the past 2 years. It is expected that this proportion will further increase to 30% to 35% in the next 5 years.

Pang Ming, chief economist and chief strategist of Huaxing securities, said that this will further boost the growth potential and valuation level of Hong Kong stocks and enhance the volume and diversity of Hong Kong stocks.

The listing of destinations from US stocks to Hong Kong stocks has also been considered in anticipation of market performance. Zhu Xiaohu, partner of Jinsha River venture capital, pointed out that the listing of some enterprises in the US has become a "tearful bell". The market value of the listed company is much lower than that before the listing, which makes it difficult for investors to achieve an ideal exit.

"The Hongkong market is still very attractive." Zhu Xiaohu believes that at present, Hongkong market, science and technology board are all good opportunities.

China's stock market returns to boost total funding

In June of this year, NetEase and Jingdong listed two times in Hongkong and completed about $7 billion in capital raising. The two transactions promoted the Hongkong market in the first half of the year to reduce the number of IPO year-on-year, and achieved a total growth of more than 20% in the same period.

He Zhaofeng, partner of the listed company in the Greater China area, said: "in the second quarter of this year, IPO activities in the mainland and Hongkong returned to the level before the outbreak of the new crown pneumonia outbreak. The main reason is that the epidemic has been controlled in the mainland of China, and some high-profile companies have made two public listings in Hongkong.

The two listing of the two technology giants has stimulated another round of market enthusiasm. Many industry insiders said that in the second half of this year, there will still be stocks in the form of two listed companies, which will have a great impact on Hongkong's annual financing.

As of the end of June this year, Baidu, Ctrip, Zhong Tong express, Hua Ju Hotel, Century Internet and other stock exchange enterprises in Hong Kong came to Hong Kong for the two time. UBS predicts that more than 40 Chinese companies in the US stock market will meet the requirements of the two listing in Hongkong.

"Many of these companies will consider going back to Hongkong for the two issue, and some of them may also choose to go to the CDR market in the mainland of China," Jin Hongyi, head of UBS's Asia Pacific Investment Bank and China's president, said at a communication conference earlier this month.

"For the possibility of seeking a two listing or re listing of the stocks, we expect that it will continue to give priority to listing in Hongkong at the present stage compared to the A share market in terms of overseas financing needs, investor base, industry supervision, the convenience of Hong Kong stock market and the continuous innovation of Hong Kong stock market." Pang Ming believes that for the larger market share, the two listing in Hong Kong is more convenient.

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