3 Mainland Firms Fuel Hong Kong's IPO Surge with $2B Raise
Hong Kong's Stock Market Sees Surge with Major Listings
Hong Kong’s stock market is experiencing a significant surge, with three major companies launching their initial public offerings (IPOs) on Thursday. These firms aim to raise a combined total of US$2 billion, marking a strong start to the year for the city's financial sector.
Among the leading participants is Muyuan Foods, a Chinese pig-breeding giant and the world's largest hog company. The firm is set to raise HK$10.7 billion (US$1.4 billion) by selling approximately 274 million new shares at a maximum price of HK$39 each. This move follows another successful billion-dollar deal from Eastroc Beverage, a Chinese drinks company.
At the maximum price, Muyuan Foods could achieve a valuation of around US$38 billion, considering both its onshore and offshore shares. On Thursday, its shares rose by 2.6% to 46.33 yuan, reflecting investor confidence in the company's prospects.
Another Shenzhen-based company, Shenzhen Han's CNC Technology, is also making waves in the Hong Kong stock market. This manufacturer of printed circuit board (PCB) equipment aims to raise up to HK$4.83 billion through its listing. In 2024, it was recognized as the largest specialized PCB equipment manufacturer in China by revenue, holding a 10% market share.
In addition, private healthcare services provider Distinct Healthcare Holdings has begun taking orders for its IPO, aiming to raise up to HK$316.4 million. These listings are part of a broader trend where Chinese consumer, food, and technology companies are increasingly turning to Hong Kong's stock market for funding.
The Hong Kong benchmark index has reached a four-and-a-half-year high, driven by investors diversifying away from U.S. assets. Recent debutants have also performed impressively, with shares in Busy Ming Group, China's largest snack and drinks retailer, surging by 69% on Wednesday.
The Hong Kong stock exchange now has over 350 companies in its IPO pipeline, setting the stage for January to record a historic level of fundraising for the month.
Muyuan Foods plans to use most of its fundraising proceeds for global expansion and diversification into markets such as Vietnam and Thailand. The remaining funds will be allocated for research and development, working capital, and general corporate purposes.
The company highlights the rapid growth of the global hog industry, which saw pork consumption increase at a compound annual rate of 4.9% from 2020 to 2024, according to Frost & Sullivan. While China remains the largest market, per capita pork intake and the share of chilled fresh pork still lag behind developed nations, presenting ample opportunities for growth.
“We are actively expanding into overseas markets to capitalize on these opportunities,” Muyuan stated. “Leveraging our proven technological expertise and innovative solutions, we aim to empower the hog farming industry by establishing an interconnected hog farming ecosystem.”
In 2024, Muyuan formed a partnership with BAF Vietnam Agriculture to enhance efficiency through hog house design, biosecurity, odor control, and smart farming equipment. This collaboration supports green operations and marks the beginning of the company’s global expansion.
The IPO attracted 14 cornerstone investors, who agreed to subscribe to US$685 million worth of shares. Notable investors include the Thai conglomerate Charoen Pokphand Group, which invested US$200 million, as well as agribusiness group Wilmar, Fidelity International, UBS Asset Management, Millennium Capital, and Jane Street.
As Hong Kong continues to attract major listings, the city's stock market remains a key player in the global financial landscape. With a growing number of companies seeking to raise capital, the market is poised for continued success in the coming months.
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