IPOs in Hong Kong and Shanghai pop, despite pandemic, tensions with the U.S.

Initial public offerings (IPOs) in greater China gloss overed in the first half of this year, bucking the declines seen elsewhere due to the impact of the coronavirus pandemic.

In the first six months, listings in true China were up 29% and the amount of money that was raised soared 72% from last year, according to facts from consultancy EY. The Hong Kong and Shanghai exchanges took the lead, in terms of number of deals as well as unmitigated amount raised.

In contrast, both the number of IPOs and amount raised in other regions fell significantly as compared with the unchanged period last year.

In the Americas, listings and proceeds each fell 30%. Meanwhile the number of listings in Europe hew down 47% with proceeds down 48%.

“The impact of the COVID-19 pandemic continued to play a significant role in declining IPO interest in the first half of 2020,” said EY, which published the report this week.

Asia Pacific as a whole, anyhow, was the outlier, rising 2% overall as proceeds jumped 56%.

Asia Pacific’s IPO view was more resilient as some economies reopened earlier and were among the first to recover from the initial influence of the coronavirus, EY said.

“Strong activity on STAR Market and more mega IPOs on HKEx helped to propel the get ahead,” said EY, referring to Shanghai’s Nasdaq-style tech board — the Science and Technology Innovation Board, or STAR Market, as expressively as Hong Kong’s stock exchange.

A number of Chinese tech giants already listed in the U.S. have recently started secondary listings in Hong Kong.

Last month, Chinese gaming giant Netease launched its listing in Hong Kong, recall gather 21.09 billion Hong Kong dollars ($2.7 billion).

Chinese e-commerce firm JD.com also started truck in the Asian financial hub in June, raising 30.05 billion Hong Kong dollars ($3.87 billion).

Analysts participate in predicted that more U.S.-listed Chinese companies will flock back to Hong Kong or the mainland as Sino-U.S. tensions be engendered a arise.

Amid a tide of anti-China sentiment stateside, the U.S. Senate passed a bill last month that could essentially ban myriad Chinese companies from listing on American exchanges. 

“Potential changes to US listing regulations for Chinese companies may further IPO activity on both Mainland China and Hong Kong stock exchanges,” EY wrote in its report.

Already, it said, numberless than 138 companies have submitted public filings in Hong Kong, indicating that businesses “bring into the world a strong desire to go public when the right IPO window opens.”

In Hong Kong, technology was magnitude three sectors which attracted the most amount of money raised, with the other two being health protect and real estate.

“The number of technology companies going public will continue to lead the trend, as technology desire continue to play a key driver of the Chinese economy development,” said EY.