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Abu Dhabi, UAEMonday 24 September 2018

Singapore losing home advantage in IPOs to Hong Kong

Hong Kong listings have had a patchy performance this year

Several Singapore firms have favoured overseas listings this year. Roslan Rahman / AFP
Several Singapore firms have favoured overseas listings this year. Roslan Rahman / AFP

Hong Kong is eroding Singapore’s home advantage.

Fourteen companies based in the Southeast Asian city have chosen to list on their home stock market this year, compared with 13 on the bourse operated by Hong Kong Exchanges & Clearing , according to data compiled by Bloomberg. That’s the biggest Singapore contingent in the North Asian city in at least a decade, the data show.

It’s not all bad news for the Lion City: Singapore Exchange Ltd. beats HKEX in funds raised from the initial public offerings. Led by NetLink NBN Trust, businesses raked in a total of US$2.54 billion, the data show. That compares with $677 million raised in Hong Kong, including from firms such as Razer, one of the year’s hottest technology IPOs. Razer chief executive Tan Min-Liang said in a Bloomberg Television interview earlier this month that Hong Kong was “the perfect location” for the firm to access capital.

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The companies that went to Hong Kong had a patchy post-IPO showing. Five stocks suffered double-digit tumbles of as much as 42 per cent, the data show. Singapore saw three of its debut stocks fall, with the largest decline at 5.6 per cent.

Hong Kong has seen a total of 138 IPOs this year, raising $14.9bn, according to Bloomberg data. Singapore had 18 initial share sales that raised $2.65bn, more than the $2bn raised in 2016 and 2015 combined, the data show.

The two former British colonies have a history of perceived rivalry. The island cities vie to be their region’s pre-eminent financial centre, as well as competing for international talent and comparing railway disruption statistics.

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