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Chinese tech unicorns ready to go public

Chinese tech unicorns ready to go public

A number of giant technology companies will be expected to launch their initial public offerings (IPO) in Hong Kong this year, and Manulife Asset Management has named a few tech unicorns.

Citywire + rated Ronald Chan said there are a lot more in the e-commerce space coming to Hong Kong in the coming few quarters.

'Ant Financials, Ping An Good Doctor, and Lufax are what we call the unicorns. The unicorns are companies that have got market capitalisation for more than $1 billion, being valued at a private market level.

‘These are the companies that will be listed in the quarters to come in Hong Kong,’ the chief investment officer of ex-Japan equities told Citywire Asia.

The Ant Financial Services Group, an affiliate company of the Alibaba Group, is expected to be listed in the first half of 2018. It runs Alipay, one of China’s top online payments platforms, and Yu'e Bao, a money market fund.

Ant Financial’s valuation hit above $60 billion by April 2016. It may soon reach a $100 billion valuation through the next round of 5 billion equity fundraising.

Lufax, an online wealth manager valued at $18.5 billion in the last fundraising in January 2016, is expected to come to the market this April. The upcoming IPO is said to increase Lufax’s valuation to $60 billion.

‘Now with more listings, the information technology (IT) component of the MSCI Asia Pacific ex-Japan Index will keep on increasing,’ Chan said, adding that the benchmark weighting of IT in MSCI Asia Pacific ex-Japan is now 35%.

‘When more high tech companies come in, obviously the market capitalisation will go up, but the multiples that people prepare to pay will also increase.

‘That would be mean there will be more investors to enjoy that high growth nature or the less cyclical nature of Asian markets,’ he concluded.


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