Hong Kong sees and uptick of IPO's  in 2024 - video Dailymotion

Alicia García-Herrero,  Chief Economist for Asia Pacific at Natixis speak to CGTN Europe about factors behind this.

Transcript

00:00 IPOs are coming in 2024. We have a list of them. The estimates are around 12 billion

00:07 US dollar, which is by no means even close to record IPOs in Hong Kong. So I would say it's

00:16 going to be a nice year, but it's not going to be a record year. And why? Talk me through the

00:21 reasons why. If there is an uptick, if all this goes ahead, why the uptick? The uptick comes from

00:29 the fact that we're not expecting any interest rate hike anymore from the Fed and Hong Kong

00:34 dollar respect to the Fed. So the funding conditions are very relevant for IPOs. So you want

00:39 to have that impression that rates are going to be lower and people are going to be able to fund

00:45 their IPOs. And that's very important. So that's one of the main reasons for the uptick. And also

00:53 possibly that the Chinese economy won't collapse next year, and it won't be as underwhelming as

00:58 2023. Actually, on the contrary, it should be basically similar to 2023, which is a good news

01:04 for the Chinese economy. How does the Hong Kong stock market compare when it comes to regulation

01:11 with others? The reason I ask is that you may have seen that London is being criticized somewhat

01:16 for having too tight regulation, but it is a fine line, isn't it? I mean, you can be too loose on

01:24 regulation and then you get money laundering and all sorts of other governance issues. Sure. I mean,

01:30 Hong Kong has long been considered quite tight. If you recall the very first IPO that Alibaba ever

01:37 did, actually they went to New York. And one reason was that Hong Kong was was

01:42 sensed to be very, very strict. So, you know, I don't think that is an issue. At least it wasn't

01:51 at the time. Things change. But it's more than where is the demand or where are the investors?

01:59 Because, you know, if you do a lot of IPO, that's supply of stuff that somebody has to buy.

02:03 If there's not enough investors, the valuations will be even lower than they are today. So that's

02:09 the risk. But there are not enough investors to buy on all of these IPOs. Which listings are

02:14 catching your eye? Which listings are among the most prominent? So, you know, we have a number of

02:20 of potential listings. And I think, interestingly, this is very, very much of a mix. We have

02:27 Midea, for example, you know, like basically on the retail space or home appliances. We also have

02:35 EV batteries, contemporary Amperix technology there. We have a little bit of technology,

02:40 self-driving vehicles, home automation technology. So we have a little bit of everything.

02:45 Healthcare. Yeah, it's kind of a nice mix. I think it's mostly about Hong Kong attracting

02:54 the savings from the rest of the world to jump on these IPOs. That's the key question.