The Chinese IPO market will explode in 2021


Reaping much success in 2020, the Chinese IPO market promises to continue to explode next year.

JD.com raised nearly $ 4 billion from the deal listed on the Hong Kong Stock Exchange in June 2020. Photo: Reuters

Looking back to 2020, William Ma, Chief Investment Officer at Noah Holdings (Hong Kong) Asset Management Company (Hong Kong) rated this as an “exciting” year for the Chinese stock market with a capital of $ 75 billion from around 400 Initial Public Offering (IPO) deals.

“The size and number of IPOs in the Chinese market (2020) has reached a historical milestone in the past 10 years,” said William Ma, predicting this trend will continue next year due to the demand of Chinese and foreign investors are still very large while the number of businesses operating in the new economic sector will increase the demand for listing.

Chinese companies account for half of the world’s top 10 listings in 2020. Notably, chip maker SMIC’s listing on the STAR stock market in Shanghai and the deal. 2 of the “big” e-commerce JD.com in Hong Kong. Except for Chinese enterprises, there is no other business in Asia-Pacific in the list of top 10 listed deals in the world.

However, 2020 is still not a successful year for the Chinese IPO market when investors are happy about the most awaited deal of the year and also the world deal of Ant Group. . The deal was postponed in November after Ant Group entered the search for a legal investigation of the authorities.

Ringo Choi, director of IPO Asia-Pacific at auditing firm EY said that the dominance of Chinese enterprises in the list of top IPOs in the world shows the importance of the platform. Chinese economy as well as the ability to dominate the performance of stock exchanges.

“That is why the markets are trying to attract companies from mainland China or listed companies in China,” said Ringo Choi.

Research by auditing firm EY also showed that the rate of return on the first day of IPO on the STAR stock exchange, also known as “Nasdaq China” reached 187% in in 2020, while this rate on the Shanghai Stock Exchange is 44%.