Kuaishou Rise to ByteDance Value Shows Wide Open Asia IPO Window

Kuaishou Technology’s eye-popping debut in Hong Kong on Friday following a mega $5.4 billion initial public offering has sent a strong signal to other listing candidates waiting in the wings -- that this is a great time to go public.

The operator of China’s most popular short-video service after ByteDance Ltd.’s Douyin saw its shares almost triple on their debut on Friday, boosting its valuation to $159 billion. That puts Kuaishou’s value close to that last sought by TikTok owner, and much bigger rival, ByteDance.

Kuaishou Rise to ByteDance Value Shows Wide Open Asia IPO Window

The startup’s debut marks a spectacular rise for the Chinese company from the 2020 price tag of $28.6 billion ascribed to it by PitchBook.

Kuaishou’s IPO has buoyed the total from first-time share sales in Asia in January to $13.3 billion, the highest for the first month of the year in the region on record, according to data compiled by Bloomberg. It comes as listings globally have also had a record-breaking start to the year thanks to a surge in SPAC listings, equities hitting fresh highs and hordes of retail traders flocking to markets.

Apart from setting an inviting precedent for ByteDance to take Douyin and other assets public to capitalize on booming investor demand for short-video companies, Kuaishou’s debut also paves the way for other listing hopefuls. Issuers, especially in the hot tech space, will likely want to take advantage of the current welcoming market window to float in the city.

A spate of U.S.-traded Chinese companies listed are also set to continue the trend of secondary listings in Hong Kong. Chinese search engine giant Baidu Inc. is among those working on a share sale in the Asian financial hub that could raise at least $3.5 billion, Bloomberg News has reported.

Video service Bilibili Inc., another Kuaishou rival, is mulling a secondary listing in the city, while New York-traded Tencent Music Entertainment Group has selected banks to arrange a Hong Kong-listing that could raise as much as $5 billion as soon as this year, according to people familiar with the matter. JPMorgan Chase & Co. and Morgan Stanley are among arrangers chosen to lead the offering by the Chinese music-streaming service, said the people, who asked not to be identified as the information is private.

Other candidates for a Hong Kong listing sometime this year include JD.com Inc.’s logistics unit, which is looking to raise about $5 billion in a Hong Kong IPO, Bloomberg News reported last year.

Elsewhere in the region, the maker of Chang beer Thai Beverage Pcl said early on Friday that it plans to list its brewery unit on the Singapore stock exchange, kicking off what could be the biggest IPO in the city-state in a decade.

©2021 Bloomberg L.P.

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