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Hong Kong exchange returns IPO application sponsored by top Chinese investment bank

Inner Mongolia Xingye Silver & Tin Mining says it plans to resubmit application before end of September

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Hong Kong Exchanges and Clearing in Exchange Square, Central. Photo: Sun Yeung
Zoe SL Chan

The Hong Kong stock exchange has returned an IPO application sponsored by China’s leading investment bank, sending a strong signal of increased scrutiny.

The listing application for Inner Mongolia Xingye Silver & Tin Mining, which is already listed on the A-share market in Shenzhen, was returned by Hong Kong Exchanges & Clearing (HKEX) on June 22, according to information released by the exchange operator on Thursday.

It was the first initial public offering application to be returned in Hong Kong in seven months, according to public records, and came amid increasing regulatory pressure as the city’s exchange experiences an IPO boom.

According to Xingye’s preliminary prospectus, which was released at the end of May, the listing was sponsored by China International Capital Corporation (CICC), which was the top sponsor of Hong Kong IPOs in the first half of this year.

Since 2014, if HKEX has deemed a listing application incomplete, it has returned the filing and publicly disclosed the sponsor’s name on its website.

Twenty-six applications have been returned: 16 for the exchange’s main board and 10 for its GEM board.

HKEX launched a market consultation in March on expanding the regime to include law firms and auditors involved in substandard listing applications.

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