IPOs are significant liquidity events that wealth managers track. Hong Kong data shows a decidedly mixed picture taking form since January.

Data on initial public offerings in Hong Kong for the nine months to the end of September this year shows a mixed picture – a surge in the number of newly-floated firms, but total fund-raisings down on the same period last year.

According to PricewaterhouseCoopers, a total of 114 companies floated on Hong Kong’s stock market in the nine months from the start of January to September, a 52 per cent surge from the same period a year ago. On the other hand, HK85.7 billion was raised via IPOs in the period, down by 37 per cent.

With IPOs significant drivers of new wealth – an important pipeline of new clients for wealth managers – the data may be cautionary reading for the Hong Kong private client industry.

One reason for the fall in fund-raising was that companies are increasingly taking a “wait-and-see” approach in present market conditions.

“Some potential blockbuster IPOs have been rescheduled or postponed due to situation changes, both externally and internally. However, it doesn’t affect the overall attractiveness of Hong Kong stock market, as the best platform for global investors and Mainland companies across the region,” PwC said. 

“Economic and political uncertainties across the region, such as Brexit, the Fed reduces its balance sheet, and tension in North East Asia, will continue to affect the sentiment of financial markets. On the other hand, the proposed US tax reform could bring positive impact on global financial markets,” it added.