( FT ) - Overseas stock exchanges could be forgiven for feeling a pang of envy this year as they watched the flood of initial public offerings in China and India.
The capital markets in each country benefited from record levels of activity, fuelled by soaring growth.
On numbers China is ahead of India, though a straight comparison is unkind given that the mainland has some catching up to do, not having recognised the concept of publicly listed equity until 1991.
Combined issuance this year by Chinese companies is on course to generate more than $100bn, with an estimated $65bn raised by A-share listings in Shanghai and Shenzhen and the bulk of the remainder through H-share listings in Hong Kong.
It is a turnround from last year when, according to Dealogic , the data provider, Hong Kong raised $42bn and the mainland exchanges a further $17bn.
This year, China's leading companies, typically listed overseas, were encouraged to return home by adding a Shanghai listing.
Among them were A-share listings by PetroChina (NYSE:PTR ) , raising $8.9bn, and China Shenhua Energy ($8.8bn).
China Pacific Insurance, meanwhile, said late on Monday that it had setthe price for its initial public offering of shares in Shanghai at Rmb30 a share, raising a total of $4.1bn.
It was also a breakthrough year for India's capital markets, albeit on a smaller scale.
IPOs on Indian exchanges have this year raised a combined $7.7bn, about three times that of 2005.
The power and property sectors led the way. In June the listing of DLF, a real estate developer, raised $2.3bn, a record amount for an Indian IPO.
Alex Woodthorpe , head of equity capital markets for the Pacific Rim at Merrill Lynch, said: "Both India and China have immense populations, and companies are growing rapidly because of this scale.
"There will continue to be a steady pipeline of IPOs as issuers seek capital to grow from the public markets."
Bankers say a widening range of Chinese companies plan to tap the capital markets next year, including infrastructure-related plays such as railway and power groups, media and publishing companies and privately owned consumer and retail firms.
However, questions are being asked about the continuing success of Chinese IPOs , given recent market wobbles.
Shares in Sinotruk , the truckmaker , and Sinotrans Shipping, the dry bulk carrier, last month each fell more than 13 per cent on first-day dealings in Hong Kong.
Fears were allayed, for the time being, by this month's performance of China Railway, which climbed 69 per cent on its Shanghai debut and 27 per cent on its Hong Kong listing, raising a combined $5.5bn.
Mark Renton, Citigroup head of investment banking Asia Pacific, said: "The indications are that issuance of A-shares and H-shares will be strong next year.
" Shanghai and Hong Kong will continue to be robust centres for capital raising for China growth."
Mr Woodthorpe expects another steady number of IPOs next year from India's real estate and consumer-related sectors, and says more Indian companies will consider listing assets on overseas exchanges such as Singapore.
Corporate India is awaiting news of the go-ahead for the IPO of Reliance Power, controlled by billionaire businessman Anil Ambani .
The listing is expected to raise $3bn early next year, and underscores robust investor appetite for power and ports assets.
Local bankers cite possible IPOs of the country's booming brokerage firms, following last month's successful listing of Edelweiss Capital.
The international fight to host Chinese and Indian IPOs is expected to intensify next year, with rival exchanges in Asia, Europe and the US all seeking to attract greater numbers of listings.
The New York Stock Exchange and Nasdaq of the US this month became the first foreign exchanges to open marketing offices in Beijing.
London's Alternative Inv- estment Market, meanwhile, hopes to continue to convince niche Chinese companies and Indian real estate developers of the merits of its light-touch regulation and ready pool of institutional capital.
However, foreign rivals will find it tough going to lure Chinese IPOs away from Shanghai or Hong Kong, given the liquidity in the local investor base, which this year virtually guaranteed healthy first-day starts.
This is the second in a three-part series on China and Indiaends