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As IPOs slump globally, all the big deals are coming from China

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In a year where initial public offerings globally have slumped by more than two-thirds, one would expect the summer break to be especially quiet. Not so in Asia, where stock listings have notched their second-highest August haul on record.

First-time share sales in the Asia Pacific region totaled $14.9 billion this month, data compiled by Bloomberg show.

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The strong showing is almost entirely down to issuers from mainland China and Hong Kong, which accounted for all but two of the IPOs raising at least $100 million, the data show.

The world’s largest travel retailer China Tourism Group Duty Free Corp. tops the list with its $2.1 billion Hong Kong listing, followed by the two mainland IPOs of Shanghai United Imaging Healthcare Co. and Hygon Information Technology Co.

The busy August in Asia stands out globally, with a typical northern hemisphere summer lull coinciding with a 2022 slump in share offerings due to fears that tighter monetary policy to curb rampant inflation would tip the global economy into recession.

Stock indexes in the red aren’t helping either. European IPOs fetched just $510 million this month, while proceeds in the US were a mere $637 million.

This year’s August tally for Asia is lower only than last year’s when the amount was more than double at $30 billion, as soaring stock markets and central bank largesse fueled a flurry of share sales.

While individual markets in the region haven’t been shielded from the listings slowdown -- Hong Kong’s IPO proceeds are 80 percent below last year’s levels -- mainland China has bucked the global trend with a record year for first-time share sales, helping mitigate the Asia-wide downturn in listings.

New stock offerings in Asia are down just 23 percent year-on-year, compared with a 68 percent plunge globally, the data show.

China’s accommodative monetary policy -- making it an outlier among major central banks -- as well as a large domestic investor base for its listings are among factors that have helped its IPO market withstand the global slump.

The strong performance of newly listed stocks is also a boon: Shanghai United Imaging Healthcare has surged 57 percent from its offer price while Hygon Information Technology has climbed 39 percent.

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