(5 February 2020 – Hong Kong) Hong Kong is readying for a significant dip in initial public offering (IPO) activity as a direct result of the devastating coronavirus epidemic with Mainland China-based corporates deferring investor roadshows indefinitely and many delaying listings due to ongoing travel bans.
Hong Kong is the world's largest IPO market and has been for four out of the last five years ahead of the NASDAQ, Saudi Stock Exchange and NYSE. Corporates from mainland China accounted for two thirds of all new listings in Hong Kong in 2019. Cases of the virus have been confirmed in more than 25 countries and territories
Companies are turning to video conferencing to continue conducting meetings however investors would still prefer face-to-face engagements for companies with a smaller profile outside the region.
Zoom Video Communications Inc. shares surged in their best day in almost a year as analysts said coronavirus fears were driving investors toward the videoconferencing company. There has been a notable increase in downloads of the Zoom app in China to 25,000 this month, up from a monthly average of 3000 to 5000 downloads.
“Current uncertainty is just not conducive for big volumes. Clearly, issuers and banks will wait to see some stabilization before racing ahead with IPO plans. It's going to be quiet” an exchange spokesperson stated.