4 mainland Chinese firms jump into cooling Hong Kong IPO market

Four Chinese firms made their initial public offerings (IPOs) in Hong Kong on Monday, with the potential to raise a combined HK$14 billion (US$1.8 billion). Strong support from key investors helped offset a slowdown in the market. RoboTechnik, an automated equipment manufacturer, sought to raise up to HK$5.18 billion, offering shares at up to HK$436, which was a 40% discount from its Friday closing price.

The company, based in Suzhou, Jiangsu province, attracted 16 cornerstone investors, totaling 35% of the offering. Shenzhen Kinwong Electronic aimed to raise HK$5.10 billion by selling more than 72.9 million shares at a maximum of HK$69.88 each, a 42% discount from its Shanghai-listed stock's Friday closing price. The firm attracted 14 cornerstone investors, including optical transceiver manufacturer Zhongji Innolight and Kingboard Holdings subsidiary KHL, who together committed US$310 million, or 47% of the total.

The other two companies launching IPOs on Monday are materials manufacturer Red Avenue New Materials, planning to raise up to HK$3 billion, and electric motor supplier Direct Drive Tech, targeting HK$1.08 billion. All four companies' shares are set to begin trading on September 29. While Hong Kong witnessed a surge in listings earlier this year, raising about US$43 billion in the first eight months, only one out of six new listings in September has gained value so far.