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{"id":18169,"date":"2022-04-06T17:47:20","date_gmt":"2022-04-06T12:17:20","guid":{"rendered":"https:\/\/thecorporatemagazine.com\/?p=18169"},"modified":"2022-04-19T09:27:54","modified_gmt":"2022-04-19T03:57:54","slug":"ipo-deals-in-china-and-hong-kong-slump-as-omicron-cases-jump","status":"publish","type":"post","link":"https:\/\/thecorporatemagazine.com\/ipo-deals-in-china-and-hong-kong-slump-as-omicron-cases-jump\/","title":{"rendered":"IPO deals in China and Hong Kong slump as omicron cases jump"},"content":{"rendered":"\t\t

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IPO deals in China and Hong Kong slump as omicron cases jump<\/h1>\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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\n\t\t\t\t\t\t\t\t\t\t\t\t\t $\"IPO$ \t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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April 6, 2022: -The number of public listings in greater China decreased hugely in the first quarter of the year but still performed better than other global markets, data from consultancy EY showed.<\/p>
Overall, Greater China had a 28% drop in the number of initial public offerings, although IPO activity in Hong Kong was slower than in mainland China.<\/p>
“Hong Kong saw slower IPO activity due to recent market volatility, an outbreak of Omicron cases, and a relatively bigger fall in the local stock market indices,” said EY.<\/p>
Hong Kong had just 12 IPO deals, a drop of over 60% compared to a year ago.<\/p>
Chinese tech shares have plummeted over the previous year, hit by China’s regulatory crackdown and ongoing tensions with the U.S. The Hang Seng Tech index is down nearly 44% compared to a year ago, while the Hang Seng index has fallen by 22% in the same period.<\/p>
“While Mainland China saw a small decline in deal numbers, proceeds increased due to hosting three of the seven mega IPOs in Q1 2022,” the firm said.<\/p>
While the number of IPOs decreased, proceeds from the overall greater China listings increased by 2% compared to a year ago, or $30.1 billion.<\/p>
The tumble in listing activity in China and Hong Kong followed the same trend in the rest of Asia-Pacific, where IPOs also decreased but not as steeply, at 16% year-on-year. IPO proceeds in Asia-Pacific rose by 18%.<\/p>
The decline in Asia-Pacific was less severe than IPOs globally \u2013 with a fall of 37% in the first quarter compared to a year ago, or 321 listings. Global IPOs are raising $54.4 billion in proceeds from January to March this year, a drop of 51% in the same period.<\/p>
“The sudden reversal can be attributed to various issues,” EY said. They include geopolitical tensions, stock market volatility, and price correction in over-valued stocks from recent IPOs.<\/p>
EY has attributed the drop to growing concerns about rising commodity and energy prices, the impact of inflation, potential interest rate hikes, and the “COVID-19 pandemic risk continuing to hold back a full global economic recovery.”<\/p>
In line with the sharp decline in global IPO activity, a “considerable” fall in SPAC IPOs, the public listing for exceptional purpose acquisition companies.<\/p>
Mega listings, which EY defined as having proceeds of over $1 billion, also fell. It said several IPO launches were postponed due to “market uncertainty and instability.”<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t
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\n\t\t\t\t Next<\/span>Investors may be increasing the gun on Chinese stocks<\/span><\/span>