THE property management arm of major domestic real estate developer China Vanke Co. has launched Hong Kong’s largest initial public offering (IPO) of 2022, aiming to raise as much HK$6.15 billion (US$783.5 million) in a deal that will be a key test for investor appetite.

Onewo Inc. yesterday offered 116.74 million shares, which represent 10% of the company’s share capital, priced between HK$47.1 and HK$52.7 each. In case an over-allotment option is exercised by investors, it will offer 134.2 million shares to raise about HK$7.1 billion.

The figure, which was released by China Vanke in a filing to the Hong Kong stock exchange, is smaller than earlier reports that said the firm planned to raise as much as US$1.5 billion. But it is still among the largest IPOs in Hong Kong this year.

On completion of the offering, Onewo’s market capitalization will be between HK$54.97 billion and HK$61.51 billion. Goldman Sachs, Citigroup and Citic Securities are joint sponsors of the offering.

China Vanke, which is China’s second-largest property developer by sales and is listed both in Shenzhen and Hong Kong, owns 62.9% of Onewo and is its biggest customer, regulatory filings showed.

Onewo offers community services such as home sales, rental brokerage, home decoration and furnishing services for property owners and residents that incorporate artificial intelligence and business process outsourcing models. It also provides property and facility management services for developers, governments and other institutional clients. China Vanke approved a spinoff of the service arm in November last year.

The company expects to finalize the IPO price Thursday and aims to begin trading on the Hong Kong stock exchange from Sept. 29, it said.

The deal is likely to reveal how much appetite investors have for buying into the services and management sub-sector associated with China’s real estate market that has been in a downturn.

China Vanke has so far defied the slowdown, logging steady profit and revenue growth in its interim results released last month. But both the firm and Onewo have warned of a potential slowdown from more headwinds in the property market.

Once Onewo’s shares debut on the Hong Kong stock exchange, their performance is also likely to influence the prospects of other property services companies looking to raise capital through public offerings. (SD-Agencies)