Hong Kong on track to reclaim global IPO crown

Mint

a day ago

After years of lackluster IPO activity, Hong Kong is back on track to be the world's No. 1 listing destination.
So far this year, there have been 41 initial public offerings in the city, Dealogic data show. At US$13.66 billion, offering proceeds have already surpassed the total sum raised during 2024.
The revival is being fueled by Chinese companies, which are flocking to the city as more favorable policies and improved market liquidity create attractive conditions.
Excluding blank-check companies, Hong Kong Exchanges & Clearing topped Dealogic's tally of IPO fundraising in the first half of the year. The Nasdaq and the New York Stock Exchange placed second and third, respectively, the financial markets platform said.
Hong Kong IPO activity had been subdued for the past several years amid postpandemic risk-off sentiment, high interest rates and a tepid stock market. In 2023, there were only 73 listings, and just US$5.90 billion raised, according to HKEX data.
The current boom is the result of multiple factors, including Chinese policy tailwinds, market dynamics and a more robust corporate pipeline, said Jacky Lai, capital market services spokesperson at EY Hong Kong.
Recent U.S.-China tensions haven't deterred activity. Rather, Hong Kong has become a preferred IPO destination for Chinese firms, a trend supported by worries that the Trump administration could order delistings from U.S. exchanges.
Hong Kong also has a key role in Chinese policymakers' efforts to breathe life back into capital markets, streamlining offering processes and vowing to open up access for investors.
Beijing's stimulus rollouts, including more funding and interest-rate cuts, have further underpinned business confidence.
In February, Chinese President Xi Jinping held a rare meeting with corporate leaders during which he signaled that he needed their help to deliver economic growth and self-sufficiency. The encounter was taken as a pro-business shift, coming after years of regulatory crackdowns on private-sector companies.
The emergence of Chinese artificial-intelligence startup DeepSeek has been another catalyst for Hong Kong's deal market. The release of DeepSeek's low-cost but powerful model in January fueled a rally in Chinese tech stocks as investors reassessed China's capacity for innovation, spurring a rerating of Chinese equities.
Chinese tech stocks have helped make Hong Kong one of the best-performing equities markets in Asia this year, pushing the benchmark Hang Seng Index up about 20% so far in 2025.
The buzzing market has drawn in a flurry of companies, such as Chinese battery giant Contemporary Amperex Technology. Already listed in Shenzhen, CATL raised almost US$4.6 billion in gross proceeds in a secondary listing in Hong Kong last month—the world's largest such offering so far this year.
On Friday alone, 16 Chinese companies filed applications to list on HKEX's main board. The following Monday, another six started to accept investor orders for shares worth nearly US$1.3 billion.
The pickup coincides with a return of risk appetite to global equity markets due to easing trade tensions from the peak uncertainty seen in April, particularly between the U.S. and China.
If Hong Kong's IPO momentum continues, the city could reclaim its title as the world's largest IPO venue for the first time since 2019, more than US$40 billion was raised in the city.
Write to Sherry Qin at [e-mail]