This report analyses the A-share and Hong Kong IPO markets in 2017, and provides an outlook for 2018.

The analysis finds that Hong Kong’s IPO market is expected to raise HKD 130 billion in 2017*, with the emergence of ‘new economy’ IPOs and anticipated new initiatives around listing reforms likely to boost proceeds to over HKD 200 billion in 2018. 

The report notes that while the number of IPOs in Hong Kong is forecasted to hit a record high of 160 in 2017, total proceeds are expected to drop to HKD 130 billion – the lowest amount since 2012 (HKD 90 billion) – due to the lack of sizeable deals. As a result, Hong Kong will be unable to retain its top spot in 2017, after ranking as the largest IPO market worldwide in 2016.  

Meanwhile, the A-share market in mainland China continues to be active, with the IPO approval rate accelerating. We forecast that the Shanghai Stock Exchange (SSE) and the Shenzhen Stock Exchange (SZSE) will raise a combined RMB235 billion from 440 IPOs in 2017, compared to RMB150 billion from 227 listings in 2016.

We expect the SSE and SZSE to remain among the top-ranked IPO destinations in 2018 in terms of funds raised. Small and medium-sized companies from the industrials and TMT sectors are likely to be the main focus next year, while listings from the healthcare and life sciences sectors will be new drivers of growth.