China’s Stock Exchanges leads Global IPO Funding in 2020

Despite all the uncertainty created amid the COVID-19 pandemic, China is expected to boast three of the top five stock exchanges in the world to generate the largest amount of funds from IPO listing in 2020.

As per KPMG International latest report titled Mainland China and Hong Kong 2020 review: IPOs and other market trends, the top-performing global stock exchanges in 2020 based on IPO listing were NASDAQ with $53.5 billion raised in IPO proceeds at the first position, the Hong Kong and Shanghai Stock Exchange are expected to be second and third with IPO listings of $50.3bn, $49.9bn, respectively.

The New York Stock Exchange is expected to be in fourth spot with $32.2bn raised in IPO listings in 2020, followed by Shenzhen Stock Exchange with $18.5bn raised in IPO listings in 2020.

The report said that despite overall market sentiment and investor confidence and economic concerns, global IPO markets have shown resilience, recovering after a slower first half and expected to end strong by recording an increase of more than 23 percent in terms of proceeds by the end of 2020, compared with last year.

As per the report, this increase is mainly due to a surge in fundraising in the leading stock markets in Mainland China, Hong Kong and the US, especially the Mainland China and Hong Kong stock exchanges, which are – set to record their most active year since 2011 in terms of proceeds.

The Shanghai Stock Exchange (SSE) and the Shenzhen Stock Exchange (SZSE) are expected to record 383 new listings for a combined RMB 461.0 billion in 2020, representing an 82 percent increase in terms of funds raised compared with 2019. This is in fact the most active year in terms of funds raised since 2011. The strong performance was backed by the continuing popularity of the STAR Market, driving the SSE to rank among the global Top 3 exchanges in terms of total funds raised.

The Shanghai Stock Exchange is expected to rank among the global top three exchanges in terms of total funds raised. The A-share market is up 82 percent in terms of funds raised compared with last year.

Hong Kong’s market has continued to attract up-and-coming companies from around the world, with a number of homecoming listings. During the period, nine US-listed Chinese-based companies completed secondary listings in Hong Kong, raising a total of HKD131.3 billion, representing approximately 34 percent of funds raised. The trend of secondary listings has highlighted Hong Kong’s solid fundamentals and its importance as an international capital-raising venue with a growing ecosystem for innovation and new economy companies.