Venus Medtech (Hangzhou) Inc.’s shares have been selling like hot cakes, as Hong Kong investors vie for a piece of new health-care stocks.
The Chinese maker of cardiovascular devices attracted retail orders worth more than $10 billion for its IPO, the largest among health-care listings in the city this year, according to data compiled by Bloomberg. Excessive demand drove the initial retail portion of the $331 million sale to be about 312 times subscribed, Venus said in a Monday filing.
Pharma companies and their shareholders are set to raise a record $5 billion in Hong Kong IPOs this year, data compiled by Bloomberg show. Including Venus and Chinese drugmaker Alphamab Oncology, the number of health-care listings will rise to 18 this year, also an all-time high.
Investors seemed to have shrugged off any doubts about profitability for many health-care issuers in the last two years. Venus, for instance, has yet to be in the black and revenue was only 115.3 million yuan ($16 million) last year.
Chinese biotechnology companies have added fuel to the boom of IPOs for the industry, after Hong Kong eased listing requirements last year, allowing pre-profit and pre-revenue firms in the sector to sell shares. With little business track records, these companies often cite bleeding-edge technology or promising drug treatments to market their potential.
Given the difficulty in predicting future profits, investors often follow famous cornerstone names when applying for health-care IPOs. Venus has Singaporean sovereign fund GIC Pte. committing about $30 million as a cornerstone investor, while Alphamab has attracted funds under Orbimed Capital LLC.
Upcoming Listings:
- Postal Savings Bank of China
- Shanghai exchange
- Size $4.8b
- Listing Dec. 10
- Citic Securities, CICC, China Post Securities, UBS Securities
- Venus Medtech
- Hong Kong exchange
- Size $331m
- Listing Dec. 10
- Goldman Sachs, CICC, Credit Suisse, China Merchants Securities
- China Merchants Commercial REIT
- Hong Kong exchange
- Size $383m
- Listing Dec. 10
- Citigroup
- Alphamab Oncology
- Hong Kong exchange
- Size $234m
- Listing Dec. 12
- Morgan Stanley, Jefferies, CLSA
- Renrui Human Resources Technology
- Hong Kong exchange
- Size up to $140m
- Listing Dec. 13
- BNP Paribas
- Bangkok Commercial Asset Management
- Thailand stock exchange
- Size $869m
- Listing Dec. 16
- Trinity Securities, Kasikorn Securities, UBS
- OneConnect Financial Technology
- New York Stock Exchange
- Size up to $504m
- Pricing Dec. 12
- Morgan Stanley, Goldman Sachs, JPMorgan, Ping An of China Securities
- Hangzhou Arcvideo Technology
- Shanghai Star board
- Size $150m
- Priced Nov. 28; listing TBA
- Citic Securities
Bloomberg
