Hong Kong Stock Exchange Revival... PwC Predicts Return to 3rd Largest IPO Market Globally Next Year

This Year Ranks 4th After Shanghai, Shenzhen, Nasdaq
This Year’s IPO Volume Expected to Plunge 68% Year-on-Year

[Image source=Reuters Yonhap News]

[Asia Economy Beijing=Correspondent Kim Hyunjung] Hong Kong, which was hit hard by the mainland's zero-COVID policy, is expected to return to the world's third-largest position in initial public offering (IPO) scale next year.

According to Chinese economic media Caixin on the 5th, global consulting firm PwC held a press conference in Hong Kong on the same day and predicted that Hong Kong's IPO fundraising scale will recover to about 180 billion to 200 billion Hong Kong dollars (approximately 30.2436 trillion to 33.604 trillion KRW) next year. PwC also estimated that Hong Kong's IPO fundraising scale this year will be only 105.6 billion Hong Kong dollars, a 68% decrease compared to the previous year.

Hong Kong has been a "global financial city" that ranked first in annual IPO scale seven times over the past 13 years. However, since the spread of COVID-19 in 2020, strict lockdowns and quarantine measures have made normal economic activities difficult, causing difficulties due to the departure of global companies and foreign investors.

PwC stated, "About 100 companies will issue new shares in Hong Kong next year," and "Among them, there will be 4 to 6 large-scale IPO projects with an average fundraising scale of over 10 billion Hong Kong dollars."

Earlier, on October 19, the Hong Kong Stock Exchange announced a consultation paper to allow IPOs of companies in next-generation information technology (IT), advanced hardware, new energy, energy saving and environmental protection, new technology, and food or agricultural technology sectors. These companies can be listed on the Hong Kong stock market for fundraising purposes even if they are not yet profitable.

As of the end of November, the world's top three IPO exchanges are the Shanghai Stock Exchange (368.2 billion Hong Kong dollars), Shenzhen Stock Exchange (219 billion Hong Kong dollars), and Nasdaq Stock Exchange (122.7 billion Hong Kong dollars). The Shanghai Exchange decreased by 20% compared to the previous year, while Shenzhen increased by 4%.

Hong Kong is expected to remain in fourth place globally this year. As of the end of November, 132 companies have submitted listing plans to the Hong Kong Stock Exchange, and at least 8 companies are scheduled to newly list in December.