Hong Kong’s biggest IPOs for 2022 set to open in the red on Thursday

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HONG KONG, Sept 28 (Reuters) – Chinese electric vehicle maker Zhejiang Leapmotor Technology and China Vanke (000002.SZ), unit Onewo Inc, two of Hong Kong’s biggest initial public offerings (IPOs) in 2022, are expected to open in the red, according to gray market trading on Wednesday.

Leapmotor shares, priced at HK$48 each to raise $800 million, fell 15% in a gray market offered by Hong Kong brokerage Phillips Securities Group.

Shares of property services company Onewo, backed by developer Vanke, fell nearly 8% in the same market.

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Onewo raised $733 million by pricing its shares at HK$49.35.

Both stocks begin officially trading on the Hong Kong Stock Exchange on Thursday.

The deals are the largest IPOs made in the city in 2022, where volumes have fallen sharply due to ongoing geopolitical tensions, soaring inflation and rising interest rates in many parts of the world. world.

Their debut follows a dismal day in the city’s markets on Wednesday.

Hong Kong’s Hang Seng Index (.HSI) fell 3.4% on Wednesday, while the technology index (.HSTECH) lost 3.85% and the real estate services index (.HSPSM) lost 5.86%.

Leapmotor and Onewo received a lukewarm response from retail investors in Hong Kong who did not accept the full amount of shares offered to them in the IPO, according to filings by the two companies.

In the past, the city’s army of mom and pop investors have invaded popular IPOs, subscribing for thousands of times more shares than were on offer.

Onewo’s institutional tranche was hedged 3.3 times and Leapmotor’s was hedged 2.3 times, according to filings.

The unallocated shares of retail investors were sold to institutional investors.

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Reporting by Scott Murdoch; Editing by Jacqueline Wong

Our standards: The Thomson Reuters Trust Principles.

scott murdoch

Thomson Reuters

Scott Murdoch has been a journalist for over two decades and works for Thomson Reuters and News Corp in Australia. He has specialized in financial journalism for most of his career and covers equity and debt markets across Asia from Hong Kong.

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