Stocks News
- Mainland's fund raising expected to surpass HK
Date: 16-Mar-2007 Sources: (Shenzhen Daily)
FUNDS raised on the mainland's stock markets in 2007 are expected to eclipse those of Hong Kong, the world's second-largest capital-raising venue for initial public offerings (IPOs), as more mainland firms seek listings at home, the chief executive of Asia's largest listed bourse said Monday.
'Total funds raised on the mainland will be higher than Hong Kong's,'said Paul Chow, chief executive officer of Hong Kong Exchanges and Clearing Ltd. (HKEx), the world's seventh-largest exchange.
Chow's comments came after a record 2006 that saw Hong Kong race past New York to become second only to London in terms of IPOs, with total listings worth over US$40 billion, thanks to a pair of colossal share offerings by Bank of China and Industrial & Commercial Bank of China.
'I do not think we will maintain that position,'Chow told an audience at a Hong Kong University lunch series. 'In 2007, we may not see mega IPOs.'
This year, mainland companies have listed to strong reception in Shanghai, among them top mainland life insurer China Life and rival Ping An Insurance (Group).
Chow expected the trend of domestic listings by mainland companies to continue as the mainland is trying to expand and revamp its capital markets. The government is actively encouraging share sales at home, to that end, analysts say.
Dual listings, in Hong Kong and on the mainland, would also become the norm for large-cap mainland companies, he said.
'The biggest challenge is when the renminbi (yuan) becomes convertible,'Chow said.
Competition is fierce as exchanges in the world try to lure mainland companies to list on their turfs. To remain competitive, HKEx is now trying to court foreign companies from South Korea to Kazakhstan to list in the city.
HKEx is in the process of revamping listing rules to make it easier for foreign companies to sell their shares in the city.
Chow said the efforts would take time to bear fruit.
He also said numerous differences between the mainland and Hong Kong bourses mean any attempt to link the two markets would have to address different market procedures.
Last week, the mainland's foreign exchange regulators said they were considering a proposal by Hong Kong to establish a system of arbitrage trade between yuan-denominated A shares and H shares, or stock in mainland firms listed in Hong Kong.
Sponsor Results:
