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Hong Kong IPO activity finally picks up after dry summer

Hong Kong

AFTER the quietest month in more than six years, initial public offerings are finally picking up in Hong Kong.

Just one company went public in the Asian financial hub in August, Hands Form Holdings Ltd, in a tiny HK$130 million (S$23 million) IPO.

The last time only one company listed in a whole month was in April 2013, data compiled by Bloomberg show.

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While it is not unusual for the summer months to be quiet with many bankers and investors on vacation, this month's activity has been particularly sedate as the city's ongoing protests and an escalating trade war between China and the United States dented investor sentiment.

Activity is now gathering pace, with one company, Shanghai Henlius Biotech Inc, on the road gauging investor demand for an initial share sale that could raise at least US$600 million, people with knowledge of the matter have said.

Czech consumer finance company Home Credit BV had a hearing with the Hong Kong Stock Exchange listing committee on Thursday, people familiar with the matter said, meaning it could also start assessing investor demand soon.

And Bank of Guizhou plans to start pre-marketing a Hong Kong IPO of up to US$1 billion as early as next week, IFR Asia reported, citing unidentified people close to the deal.

Hong Kong badly needs more deals. With only US$10.8 billion raised through IPOs so far, it ranks fourth among global exchanges, behind rival New York.

This time last year companies had raised US$24.3 billion in Hong Kong IPOs, though admittedly 2018 was a blockbuster year. BLOOMBERG