The funds raised from initial public offerings (IPOs) on Hong Kong exchanges so far this year fell by 59% year-on-year, according to data produced by EY.
The amount raised, US$5.3 billion, is the lowest since 2003. The number of IPOs also fell in the last year, by 19% to just 61.
According to the report, poor market sentiment and weak-post IPO performance are two of the main reasons that some high-profile have decided against listing in Hong Kong.
EY also calls on the Hong Kong government to do more to aid a recovery and refers to one of the initiatives underway – the launch of the Fast Interface for New Issuance platform which is designed to use digital technology to shorten the settlement cycle.
The last time listings were so low in Hong Kong, in 2003, the local market was recovering from the outbreak of the Sars virus. In the last two years, Hong Kong’s financial sector was badly affected by strict lockdown policies imposed by the Chinese government during the Covid-19 pandemic.
It is also worth noting that global IPO activity is also down – in the last year, the value and the number of IPOs have fallen by 35% and 12% respectively.
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