Arab Press

بالشعب و للشعب
Friday, Jun 20, 2025

Hong Kong listings dry up under shadow of protests

Hong Kong listings dry up under shadow of protests

‘Terrible’ conditions on stock market deter deals but some expect pipeline to pick up later in year

When AB InBev’s Asia brewing business launched its second attempt at a Hong Kong stock market listing last week, chief executive Jan Craps faced a volley of questions about whether the territory was still the best venue for an initial public offering of almost $5bn after more than three months of political upheaval.

“We believe Hong Kong is the best financial centre for us in Asia to do the listing,” he said. “There is a very bright future for Hong Kong as a financial centre.”

Mr Craps is unusually upbeat. The flow of initial public offerings in Hong Kong has nearly evaporated in recent months, as companies hold off on planned listings in the face of volatility spurred by an escalating US-China trade war and intensifying violence between police and protesters on the Asian financial hub’s streets.

Hong Kong Exchanges and Clearing, the local bourse operator, has seen only two IPOs price since the end of July, raising a total of just $33m and taking cumulative funds raised in 2019 to $10.7bn, according to data from Dealogic.

That is just a third of the total from this time last year, when Hong Kong was well on its way to taking the global listings crown for 2018. Meanwhile, the number of active listings applications from companies yet to go ahead with an offering has climbed to a record high of more than 200, according to KPMG.

The fall is particularly sharp thanks to a run of big-ticket listings in 2018 that saw Xiaomi, Meituan Dianping and China Tower raise almost $16bn in total between the end of June and mid-September.

But HKEX’s rivals in New York have seen no such drop-off. The New York Stock Exchange and Nasdaq have priced a combined $5.39bn worth of IPOs in August and September across 19 deals. Both are now on a course to dethrone Hong Kong’s exchange as the world’s top listings destination just as it targets London Stock Exchange shareholders with a charm offensive, selling them on Hong Kong’s potential as the gateway to a globalising Chinese market in its bid to buy the British bourse.

Jason Elder, a partner at law firm Mayer Brown in Hong Kong, said the uptick in volatility for the territory’s stock market had unnerved companies that were in the process of listing this year.

“It becomes very difficult to price your IPO against a volatile window, I think that’s why people are waiting,” Mr Elder said. But he added there was little sign of companies abandoning Hong Kong for other bourses, with recent reforms to the exchange’s listing rules — such as allowing weighted voting rights — helping prevent applicants from changing venues.

“That all helps, but it only helps against a backdrop of positive investor sentiment,” he said.

Sentiment in Hong Kong has worsened markedly since the end of July, with the Hang Seng stock index falling 9 per cent in early August. Earlier this month, Fitch became the first big rating agency to downgrade the territory since the start of mass protests demanding withdrawal of an extradition bill that would have allowed criminal suspects to be sent to mainland China.

Protester demands have since expanded to include greater police accountability and democratic reforms, with large-scale demonstrations continuing despite plans announced by Carrie Lam, Hong Kong’s chief executive, to fully withdraw the bill.

“The Hong Kong IPO market has been absolutely terrible,” said the head of Asia capital markets at one international bank. He added his bank and others had also begun opening credit lines to many high-growth private companies in the region, relieving the pressure for a quick listing.

Hong Kong also faces a challenge from China’s new technology and science-focused Star Market in Shanghai. The high-profile project has direct backing from president Xi Jinping and threatens to swipe Chinese tech listings away from the territory, although there is no sign yet that it could touch bigger deals such as AB InBev or the planned secondary listing of Alibaba, which could raise up to $20bn if it goes ahead.

Louis Lau, a partner at KPMG China’s capital markets advisory group, said there were “a lot of uncertainties, globally and locally” behind the quiet spell for IPOs, including the market impacts of trade tensions and recent social unrest in Hong Kong. “It all depends on the market conditions,” he said.

KPMG expects the taps of Hong Kong’s IPO pipeline to turn back on in the fourth quarter amid encouraging signs such as the AB InBev listing and the revival of another application by logistics company ESR Cayman. But Mr Lau added that the chance of Hong Kong catching up with New York’s bourses by the year’s end really depended on whether all big deals, such as that by Alibaba, are completed by the end of the year.

“Otherwise the gap is pretty big,” he said.

Newsletter

Related Articles

Arab Press
0:00
0:00
Close
16 Billion Login Credentials Leaked in Unprecedented Cybersecurity Breach
Senate hearing on who was 'really running' Biden White House kicks off
G7 Leaders Fail to Reach Consensus on Key Global Issues
Mass exodus in Tehran as millions try to flee following Trump’s evacuation order
Iranian Military Officers Reportedly Seek Contact with Reza Pahlavi, Signal Intent to Defect
China's Iranian Oil Imports Face Disruption Amid Escalating Middle East Tensions
Trump Demands Iran's Unconditional Surrender Amid Escalating Conflict
Israeli Airstrike Targets Iranian State TV in Central Tehran
President Trump is leaving the G7 summit early and has ordered the National Security Council to the Situation Room
Netanyahu Signals Potential Regime Change in Iran
Analysts Warn Iran May Resort to Unconventional Warfare
Iranian Regime Faces Existential Threat Amid Conflict
Energy Infrastructure Becomes War Zone in Middle East
Iran Conducts Ballistic Missile Launches Amid Heightened Tensions with Israel
Iran Signals Openness to Nuclear Negotiations Amid Ongoing Regional Tensions
Shock Within Iran’s Leadership: Khamenei’s Failed Plan to Launch 1,000 Missiles Against Israel
UK Deploys Jets to Middle East Amid Rising Tensions
Exiled Iranian Prince Reza Pahlavi Urges Overthrow of Khamenei Regime
Wreck of $17 Billion San José Galleon Identified Off Colombia After 300 Years
Iran Launches Extensive Missile Attack on Israel Following Israeli Strikes on Nuclear Sites
Israel Issues Ultimatum to Iran Over Potential Retaliation and Nuclear Facilities
Coinbase CEO Warns Bitcoin Could Supplant US Dollar Amid Mounting National Debt
Trump to Iran: Make a Deal — Sign or Die
Operation "Like a Lion": Israel Strikes Iran in Unprecedented Offensive
Israel Launches 'Operation Rising Lion' Targeting Iranian Nuclear and Military Sites
Israeli Forces Intercept Gaza-Bound Aid Vessel Carrying Greta Thunberg
IMF Warns of Severe Global Trade War Impacts on Emerging Markets
Syria to Reconnect to Global Economy After 14 Years of Isolation
Saudi Arabia Faces Uncertainty Over Succession After Mohammed bin Salman
Israel Confirms Arming Gaza Clan to Counter Hamas Influence
Majority of French Voters View Macron's Presidency as a Failure
U.S. Reduces Military Presence in Syria
Trump Demands Iran End All Uranium Enrichment in Nuclear Talks
Iran Warns Europe Against Politicizing UN Nuclear Report
Businessman Mauled by Lion at Luxury Namibian Lodge
Paris Saint-Germain's Greatest Triumph Is Football’s Lowest Point
OPEC+ Agrees to Increase Oil Output for Third Consecutive Month
Turkey Detains Istanbul Officials Amid Anti-Corruption Crackdown
Meta and Anduril Collaborate on AI-Driven Military Augmented Reality Systems
EU Central Bank Pushes to Replace US Dollar with Euro as World’s Main Currency
European and Arab Ministers Convene in Madrid to Address Gaza Conflict
Head of Gaza Aid Group Resigns Amid Humanitarian Concerns
U.S. Health Secretary Ends Select COVID-19 Vaccine Recommendations
Trump Warns Putin Is 'Playing with Fire' Amid Escalating Ukraine Conflict
India and Pakistan Engage Trump-Linked Lobbyists to Influence U.S. Policy
U.S. Halts New Student Visa Interviews Amid Enhanced Security Measures
Trump Administration Cancels $100 Million in Federal Contracts with Harvard
SpaceX Starship Test Flight Ends in Failure, Mars Mission Timeline Uncertain
King Charles Affirms Canadian Sovereignty Amid U.S. Statehood Pressure
Iranian Revolutionary Guard Founder Warns Against Trusting Regime in Nuclear Talks
×