Blockbuster IPOs in HK, KL could be start of more in Asia

Efforts on to revive listings in S'pore; Fed's expected rate cut likely to boost confidence

- Kang Wan Chern

Blockbuster initial public offerings (IPOs) appear to be making a comeback in the region ahead of an expected interest rate cut by the US Federal Reserve and as investor confidence returns on the back of an improving economic outlook.

A blockbuster IPO typically involves a company whose listing is highly anticipated by investors and the public, enjoys strong valuations and media coverage, and usually raises a substantial amount of capital when it goes public.

With risk appetites rising, the market could see more of such IPOS as firms that had held back on listing when interest rates were high now take the opportunity to go public in the months ahead.

The higher interest-rate environment since 2022 has been stifling investor appetites for riskier investments like stocks.

"Many companies are tapping the current window of opportunity to push on with their listings. Depending on the success of these listings, it may pave the way for a further revival in the IPO market, as these major listings are looked upon as a test of investors' interest," said Mr Yeap Jun Rong, market strategist at trading firm IG.

Midea Group is one example. The Chinese home appliance maker on Sept 9 launched a share offering of about HK$26.97 billion (S$4.5 billion) in Hong Kong, marking the city's largest listing in more than three years.