Domestic listings overtake APAC cross-border IPOs with 47% increase to US$31.9 bilion

Although cross-border IPOs also performed well.

Companies raised US$23.9 billion in cross-border IPOs in Asia Pacific this year, a 26% increase over 2013.

According to a research report from Baker & McKenzie, domestic listings, however, increased by 47% to US$31.9 billion. As a result, the region’s 2014 index score declined slightly to 42.3, from 42.7 last year.

The Hong Kong Stock Exchange (HKSE) dominated the region’s exchanges, where companies raised a total of US$22.4 billion in 62 cross-border IPOs — the highest number of listings worldwide.

Companies in the energy & power, consumer staples and industrials industries raised the most capital through cross-border IPOs in Asia Pacific.

Mainland China-based CGN Power’s recent listing on the HKSE is currently the region’s top cross-border IPO of the year, having raised US$3.2 billion.

Here's more from Baker & McKenzie:

CGN Power’s reign may end before the end of the year with Dalian Wanda Commercial Properties’ listing on the HKSE, a floatation expected to raise between US$3.5 billion and US$6 billion.

Despite the growth of cross-border IPOs globally, mainland China was a notable exception as the reopening of the Shanghai and Shenzhen stock exchanges to IPOs gave Chinese companies the option to list at home.

The resurgence of domestically-listed IPOs will be further stoked by the opening of the Shanghai-Hong Kong Stock Connect, which enables Hong Kong and Mainland China investors to trade and settle shares listed in the other market through their home exchange.

With the reopening of the Chinese exchanges and ease of investing in Chinese companies through Connect, the number of Chinese companies listing domestically will likely continue rising.

“With the projected increase of domestic IPOs in China and the opening of the Shanghai-Hong Kong Stock Connect, 2015 may be a year of change for cross-border IPOs in the region,” says Ashok Lalwani, chair of Baker & McKenzie’s Asia Pacific Capital Markets Practice Group.

“While Asia Pacific will remain a driving force for cross-border IPOs, domestic IPOs in China may take on a more prominent role. In addition, we expect to see a larger number of crossborder IPOs from Southeast Asia and India, with the US being an increasingly frequent and popular destination.”