London Daily

Focus on the big picture.
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

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
Iranian Military Officers Reportedly Seek Contact with Reza Pahlavi, Signal Intent to Defect
FBI and Senate Investigate Allegations of Chinese Plot to Influence the 2020 Election in Biden’s Favor Using Fake U.S. Driver’s Licenses
Vietnam Emerges as Luxury Yacht Destination for Ultra‑Rich
Plans to Sell Dutch Embassy in Bangkok Face Local Opposition
China's Iranian Oil Imports Face Disruption Amid Escalating Middle East Tensions
Trump's $5 Million 'Trump Card' Visa Program Draws Nearly 70,000 Applicants
DGCA Finds No Major Safety Concerns in Air India's Boeing 787 Fleet
Airlines Reroute Flights Amid Expanding Middle East Conflict Zones
Elon Musk's xAI Seeks $9.3 Billion in Funding Amid AI Expansion
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
Taiwan Imposes Export Ban on Chips to Huawei and SMIC
Israel has just announced plans to strike Tehran again, and in response, Trump has urged people to evacuate
Netanyahu Signals Potential Regime Change in Iran
Juncker Criticizes EU Inaction on Trump Tariffs
EU Proposes Ban on New Russian Gas Contracts
Analysts Warn Iran May Resort to Unconventional Warfare
Iranian Regime Faces Existential Threat Amid Conflict
Energy Infrastructure Becomes War Zone in Middle East
UK Home Secretary Apologizes Over Child Grooming Failures
Trump Organization Launches 5G Mobile Network and Golden Handset
Towcester Hosts 2025 English Greyhound Derby Amid Industry Scrutiny
Gary Oldman and David Beckham Knighted in King's Birthday Honours
Over 30,000 Lightning Strikes Recorded Across UK During Overnight Storms
Princess of Wales Returns to Public Duties at Trooping the Colour
Red Arrows Use Sustainable Fuel in Historic Trooping the Colour Flypast
Former Welsh First Minister Addresses Unionist Concerns Over Irish Language
Iran Signals Openness to Nuclear Negotiations Amid Ongoing Regional Tensions
France Bars Israeli Arms Companies from Paris Defense Expo
King Charles Leads Tribute to Air India Crash Victims at Trooping the Colour
Jack Pitchford Embarks on 200-Mile Walk to Support Stem Cell Charity
Surrey Hikers Take on Challenge of Climbing 11 Peaks in a Single Day
UK Deploys RAF Jets to Middle East Amid Israel-Iran Tensions
Two Skydivers Die in 'Tragic Accident' at Devon Airfield
Sainsbury's and Morrisons Accused of Displaying Prohibited Tobacco Ads
UK Launches National Inquiry into Grooming Gangs
Families Seek Closure After Air India Crash
Gold Emerges as Global Safe Haven Amid Uncertainty
Trump Reports $57 Million Earnings from Crypto Venture
Trump's Military Parade Sparks Concerns Over Authoritarianism
Nationwide 'No Kings' Protests Challenge Trump's Leadership
UK Deploys Jets to Middle East Amid Rising Tensions
Trump's Anti-War Stance Tested Amid Israel-Iran Conflict
Germany Holds First Veterans Celebration Since WWII
U.S. Health Secretary Dismisses CDC Vaccine Advisory Committee
Minnesota Lawmaker Melissa Hortman and Husband Killed in Targeted Attack; Senator John Hoffman and Wife Injured
Exiled Iranian Prince Reza Pahlavi Urges Overthrow of Khamenei Regime
×