HK's IPO market withers as billion-dollar listings lapse

Hong Kong

HONG Kong's primary listing market is going through a dry patch in what is normally the busiest time of the year.

Several potential billion-dollar initial public offerings ranging from supermarket owner WM Tech to healthcare startup We Doctor Holdings have let their applications lapse in recent weeks as regulatory scrutiny and stock market weakness crimp listings.

Large IPOs falling by the wayside are a further sign of how China's regulatory onslaught is causing a downturn in the financial hub's market for first-time share sales. After a stellar first half, the value of IPOs dipped to just US$6.2 billion in the third quarter - the lowest since the start of the pandemic and behind South Korea for the first time in four years. To be sure, 2021 will still likely rank highly in terms of IPO proceeds thanks to the sheer volume of issuance in Hong Kong in the six months. With US$37.7 billion raised so far, this year is on track to be one of the best of the last decade.

We Doctor's planned float - which could have raised as much as US$3 billion - got caught up in China's tightening oversight of how its tech giants manage the data they collect. The Tencent Holdings-backed company plans to refile for a Hong Kong listing but any deal won't be quick, according to sources.

Meanwhile, WM Tech, which is behind the Wumart chain and Metro AG's outlets in China, faced questions from the bourse about its business operations, Bloomberg News reported. BLOOMBERG