Tech Giants, Medical Stocks Lead in Hong Kong Listings

The bourse has been actively easing restrictions and luring tech giants in the first half-year to boost liquidity.

Author: Belinda Zhou   

The Stock Exchange of Hong Kong (HKEX) has risen to third place among bourses across the world in total funding raised.

The exchange, 20 years in operation, saw a year-over-year increase of 25% in the financing size in the first half-year, totaling HK$87.1 billion ($11.2 billion). Weighed down by the Covid-19 pandemic, however, the HKEX has listed 59 companies, 22% less than in the first half of 2019. 

The bourse has been actively easing restrictions and luring tech giants in the first half-year to boost liquidity inflow.

The top five new stocks this year were innovative enterprises, with total financing of about HK$62.9 billion, compared with a HK$21.8 billion in the same period last year, up 118%.

Chinese e-commerce firm (Nasdaq: JD; HKEX: 09618) lifted off in a secondary listing of HK$30.1 billion ($3.9 billion) in June, accounting for 35% of HKEX's fundraising amount in the first half-year.

It was preceded by Chinese gaming giant NetEase (Nasdaq: NTES; HKEX: 09999), which raised HK$21.1 billion ($2.7 billion), contributing 24% to the total.

The other three companies are in the medical sector. Kangji Medical Holdings Ltd. (HKEX: 09997), which works in the design, development, manufacture, and sale of minimally invasive surgical instruments and accessories, has doubled its stock price since the listing.

Interventional procedural medical devices provider, Peijia Medical Ltd. (HKEX: 09996), closed at HK$33.3 ($4.3) per share on Tuesday compared with its level of HK$25.8 ($3.33) per share on May 15.

Akeso Inc. (HKEX: 09926), addressing global unmet medical needs in oncology, immunology, and other therapeutic areas, has doubled in market cap since its debut in April.

"Since retail investors have always been more enthusiastic about investing in small new shares, the oversubscription ratio in the first half of this year has improved from the same period last year," consulting firm Deloitte wrote in its analysis.

In the first half of this year, 96% of new shares were oversubscribed, compared with 81% in the same period last year, and 56% of the projects were oversubscribed more than 20 times, while 30% were recorded in the same period last year.

Real estate, technology, media and telecommunications (TMT) industries ranked at the top in terms of the proportion of new shares in Hong Kong in the first half of 2020, according to Deloitte's report.

Deloitte predicts that there would be about 130 new shares listed in Hong Kong this year with the funds raised between HK$160 and HK$220 billion, including five to eight Chinese stocks seeking a secondary listing.