SYDNEY, June 27 (Reuters) - A possible revival in IPOs

in Hong Kong after a pickup in Chinese regulatory approvals, and

a string of mega deals in India are expected to make Asia a

bright spot for equity deals in the second half of this year,

bankers and analysts said.

Despite the extended downturn in Asia initial public

offerings (IPOs), India's share in Asia equity capital market

(ECM) deals is at record high now, and the surge in deals is

expected to last for the foreseeable future, they added.

India's total ECM deals jumped 137% in the first half of

this year from the same period of last year, with $28.5 billion

raised, according to LSEG data. IPOs accounted for $4.25 billion

of that, up 89.3% on last year's first half.

Hyundai India's $2.5 billion to $3 billion IPO

due later in 2024 is set to be the South Asian country's largest

ever new share sale, and it would also be one of the biggest

IPOs globally this year.

In comparison, elsewhere in Asia, mainland Chinese ECM deals

dropped nearly 70% to be worth $25.5 billion and IPOs were off

83.1% to $5.3 billion, the worst first half performance in 11

years.

The value of IPOs in Hong Kong fell from $2.12 billion in

the first half of 2023 to $1.46 billion, the LSEG data showed.

"As investors get to grips with India's growth outlook and

the growth adjusted valuations, helped further by the monetary

easing environment, it will spur foreign investors to come

back," said Citigroup Asia ECM origination head Udhay Furtado.

"That pivot to India growth is a staggered rotation. That's

why it's not been a flood. I think you'll see that change with

the names that are coming to market in the next 18 months as

they are going to be globally impactful."

While Hong Kong's IPO market remains at a low, the Hang

Seng's almost 9% rise in the past three months is seen as

a positive to encourage more public market debuts in the coming

months.

"While global investors remain cautious towards Hong Kong

and China there is improved sentiment on the back of ongoing

policy support and strong corporate earnings," said Sunil

Dhuphelia, JPMorgan's co-head of Asia ECM, ex-Japan.

"This has led to global investors reducing underweight

positions in the past couple of months," he said, referring to

the two markets.

The China Securities Regulatory Commission (CSRC) has

approved applications from 76 IPO hopefuls so far this year to

list offshore, compared to 80 for all of 2023, according to the

regulator's website.

Some Chinese companies, however, still find the process of

gaining approval uncertain and volatile markets means some do

not go ahead with launching a deal, bankers said.

"If the broader market valuation increases, you will see a

lot more follow-on deals and blocks in Hong Kong from China -

that will come first," said Selina Cheung, UBS' co-head of Asia

equity capital markets.

"Hopefully we are on the right upward trend with the right

policy supports. When the market is sufficiently strong,

hopefully, the CSRC will have a relaxation towards approving

IPOs."