HK joins IPO pop parade


    HONG KONG- Bankers have for years told investors and corporate clients not to expect big first-day gains in Hong Kong like those New York is renowned for. This is no longer true after a series of eye-popping debuts including e-cigarette maker Smoore International’s 150 percent gain and this week, a 56 percent bump for JD Health International, now valued at $45 billion. There’s a changing dynamic in the local market beyond a general rally.

    Hong Kong debutants have enjoyed a 29 percent average first-day gain this year, according to Dealogic, compared to 19 percent in Manhattan. Over the past decade, the Asian financial hub’s average has been less than half its rival’s 15 percent. Some of the change has to do with a buoyant market, but much can be put down to the sorts of companies now going public.

    Nine of Hong Kong’s 10 biggest pops in the past five years are 2020 vintage. Of those, three are biotechnology- or healthcare-related, three are technology stocks including JD Health and three are China consumer companies. That’s a big change from the previous parade of stolid Chinese state-owned enterprises and regional banks. Hong Kong changed its rules two years ago to lure more startups and new-economy stocks, and it is working.