- Firm adds surgical masks, disinfectant to its line-up of skincare and health supplements en route Hong Kong IPO
- Hong Kong IPO proceeds have dwindled this year amid pandemic, set for leanest quarter in seven years: Refinitiv data
Tycoon Group Holdings, seller of health supplements and skin care products, launched its initial public offering (IPO) in Hong Kong, having recently added "anti-epidemic" products like surgical masks to its portfolio amid the coronavirus outbreak.
The firm is offering 192.4 million shares for sale globally through April 3, with 19.2 million for Hong Kong investors and 173 million for international buyers at a range of HK$1.48 to HK$1.52 per share, according to a statement on Monday.
The group aims to raise HK$230.3 million (US$29.5 million) net of listing expenses, based on the mid-price of HK$1.50 apiece. Its shares are expected to start trading on the city's stock exchange on April 15 under the stock code 3390.
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The stock offering will test investor appetite amid wild swings in global markets, with many major stock indexes falling into bear-market territory this month as the coronavirus pandemic inflicts higher death toll worldwide. Proceeds from IPOs in Hong Kong have shrunk by at least one-third this quarter from a year earlier amid the health crisis.
For Tycoon Group, the money will help pay for efforts to develop its supply chain and retail management system, promote some of its 120 different brands in Hong Kong, Macau, mainland China and Singapore, repay older debt and for working capital, it added.
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The company recently ventured into sourcing and distributing surgical masks, thermometers, hand sanitiser and cleaning wipes, as demand for anti-epidemic items surges as medical professionals and individuals run out of supplies.
"During the Covid-19 outbreak, the group has remained steadfast in pursuing the strategy of broadening product selection by constantly rolling out new products that are sought-after by consumers," it said. "This move demonstrated the group's ability and capability to provide products that tackle the prevailing market needs."
A host of companies have also pivoted into producing masks to help ease the shortage, including "newcomers" like carmaker BYD, iPhone assembler Foxconn and oil refiner Sinopec, as usual production across China stalled amid lockdown.
Tycoon Group may be hoping its new product lines will give its IPO a boost. Hong Kong-listed Ta Yang Group, soared as much as 12 per cent on February 14, after the producer of silicon and rubber keypads won an order to produce masks for Beijing.
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Meanwhile, Italian luxury fashion brand Prada said it will produce 80,000 medical overalls and 110,000 masks for health care workers in Tuscany, Italy. French conglomerate Kering said on March 22 its subsidiaries Balenciaga and Yves Saint Laurent will manufacture masks. Its Paris-listed stock has risen 18 per cent since the announcement.
Companies raised US$607 million from IPOs in Hong Kong this month, compared with US$1.39 billion in the same period last year, according to Bloomberg data. This year through March 26, the US$1.8 billion raised is set for the leanest quarter for Hong Kong in seven years, according to Refinitiv data.
For now, China is leading the global IPO league table for the first time in almost three years as Hong Kong slipped to sixth. Some 33 companies have raised US$7.31 billion on the Shanghai main bourse and STAR market, exceeding the US$5.13 billion on Nasdaq, according to Refinitiv.
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