Chinese Listing Spree Sparks Revival Hopes in Hong Kong Stocks
(Bloomberg) -- A wave of listings by Chinese companies is expected to reinvigorate trading activity in Hong Kong, with optimism growing that a robust pipeline of debuts will drive the broader stock market higher.
First-time share sales in Hong Kong have raised HK$77 billion ($9.9 billion) this year through May, the most for the period since 2021, buoyed by a blockbuster offering by battery giant Contemporary Amperex Technology Co.
The boom looks set to continue as companies that represent China's industrial ambitions and rising technological capabilities — such as chipmaker Will Semiconductor Co. and luxury carmaker Seres Group Co. — prepare to debut on the Hong Kong exchange.
While there is yet to be a meaningful pickup in turnover, the listings are a welcome development for a market that had been bogged down in recent years by low liquidity and a dearth of prominent new entrants to attract global capital. The Hang Seng Index remains 25% below its 2021 peak despite a 16% gain this year.
'The fundraising rush will be a boon for liquidity and finally make Hong Kong 'China's Nasdaq,' more so than any of the onshore growth boards, given the quality of the listings,' said Chen Da, founder of Dante Research. The arrival of high-profile Chinese companies, and the trading activity that brings, may revitalize stocks that had fallen into obscurity due to low turnover in the broader market, he said.
Hong Kong has long been a gateway for global investors seeking exposure to mainland Chinese companies, which currently make up 70% of the Hang Seng Index's weighting. While this role has also left the city's stocks vulnerable to China-US tensions, strong performance by recent entrants shows investors believe the rewards of owning a slice of China's new-economy stocks outweigh the risks of volatility.
Share prices for bubble tea makers Mixue Group and Guming Holdings Ltd., and toy manufacturer Bloks Group Ltd., have more than doubled since their Hong Kong debuts this year.
The offerings are 'fundamentally reshaping the DNA of the market, representing a strategic upgrade for the city's market,' said Yang Ruyi, fund manager at Shanghai Prospect Investment Management Co. 'Hong Kong is re-branding from merely a China offshore market into a globally-watched benchmark pricing the new economy.'
Tech stocks and those embodying new consumption trends could make up 50% of the weightings of the exchange's constituents in the coming years, she expected.
To some market watchers, the burst of activity is evoking memories of the IPO boom in the early 2000s that laid the groundwork for a near-300% rally in the Hang Seng Index over the four years through 2007. Zeng Wenkai, a fund manager at Shengqi Asset Management, draws parallels to the momentum that followed Tencent Holdings Ltd.'s 2004 debut, and sees valuations increasing by 20% across the board over the next year.
In another potential boost, fast-fashion retailer Shein Group Ltd. is considering switching its planned initial public offering to Hong Kong from London. The bullish sentiment is evident in the gains in Hong Kong Exchanges & Clearing Ltd., whose stock has rallied 36% this year.
IPO proceeds could reach HK$160 billion — or $20 billion — this year and put Hong Kong back at the top perch globally, according to estimates by CGS International. Bing Yuan, a fund manager at Edmond de Rothschild Asset Management, said stellar listings by the likes of CATL and Jiangsu Hengrui Pharmaceuticals Co. suggest companies with global footprints and strong governance standards tend to attract more interest from international investors.
Despite the budding optimism, a meaningful boost to liquidity and a shift in global funds' perception of Hong Kong as an attractive destination may take time to materialize. There is also the risk of new listings diverting demand away from existing stocks and somewhat offsetting the boost to the broader market.
Read: Chinese Firms Go on Fundraising Spree Amid Rush of Easy Money
There's little doubt though that a broader revaluation is underway. The Hang Seng Index is among Asia's best performers this year, thanks to an earlier rally driven by DeepSeek's artificial intelligence breakthrough and Beijing's economic support. The Hong Kong benchmark now trades at 10.3 times forward earnings estimates, above a three-year average ratio at around nine.
'The inclusion of H-share listings of A-share companies in major MSCI indexes could serve as a meaningful catalyst for both passive and active capital flows into Hong Kong,' said Gary Tan, portfolio manager at Allspring Global Investments. 'This is particularly significant for sectors such as tech and consumer, which remain underrepresented in Hong Kong relative to their growing importance in China's economic future.'
--With assistance from Abhishek Vishnoi and Dave Sebastian.
More stories like this are available on bloomberg.com
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
India Today
an hour ago
- India Today
WWDC 2025 is in few days and here is everything we expect Apple to announce
Apple's annual event, WWDC 2025, is just around the corner, and several reports highlight what the company is about to announce. The tech giant has confirmed that the event will kick off from June 9 to June 13. The event, which will be livestreamed on YouTube, is set to kick off with a keynote on June 9, starting at 1 PM ET (10.30 PM IST). After announcing the date and time, the company has kept other announcements a secret so far. But the rumours and leaks have got you covered. The WWDC 2025 may shed light on the upcoming iOS, advanced Apple Intelligence features, an overhaul of the VisionOS and a glimpse of the iPhone 17 are sure that while the software will take centre stage, the hardware may just lurk behind the curtains. Let's look at the upcoming announcement at WWDC 2025 in 2025: What to expectNew interface: Apple's Worldwide Developers Conference (WWDC) 2025 is shaping up to be more about makeovers than major new tricks. According to Bloomberg's Mark Gurman, the company is preparing a sweeping visual refresh across all its platforms — iOS, iPadOS, macOS, watchOS, and tvOS — with a design overhaul codenamed Solarium. Inspired by visionOS, users can expect softer aesthetics, including rounded icons and translucent menus, breathing new life into the interface last radically changed with iOS 7. iOS 26 to replace iOS 19 name: In a move to simplify its software naming scheme, Apple might also ditch the traditional version numbers. So instead of iOS 19 or macOS 15, we could see names like iOS 2026 and macOS 2026, aligning updates with calendar years — a sensible, if overdue, change for clarity across the redesign taking centre stage, Apple won't arrive empty-handed on the features front. iOS 26 is tipped to include simplified Wi-Fi sharing across Apple devices, AI-powered battery management, and even a desktop mode for iPhones with USB-C ports, allowing users to plug into external displays for a more PC-like experience. iPadOS 26 will reportedly gain a more Mac-like experience too, with a top menu bar and improvements to Stage Manager, Apple's multitasking interface. Meanwhile, macOS and other systems are expected to get visual consistency rather than headline-grabbing app for games: Gamers may get a little love too. Gurman hints at a new cross-platform gaming app that builds on Game Centre, adding friend lists, leaderboards and deep Apple Arcade integration, and it'll run across iPhone, iPad, Mac and Apple Intelligence: As for Siri and Apple Intelligence, the focus this year is on improving what's already in the works, including smarter, more context-aware responses and a new health-coaching tool. Developers should also expect new tools to better integrate Apple Intelligence into third-party update: And yes, there's still a chance for some shiny hardware, perhaps an M4 Mac Pro or even a sneak peek at those rumoured smart glasses. While WWDC is primarily a software showcase, Apple has previously used the stage for hardware reveals — such as the Vision Pro and new Macs in 2025, with the MacBook Air M4, iPad Air M3, and iPhone 16e already launched, major hardware announcements seem unlikely. However, a refreshed Mac Pro could still appear, given its relevance to developers. There's also quiet speculation about the iPhone 17 Air — tipped to be the slimmest iPhone yet. While a full unveiling is doubtful, Apple might offer a brief preview during the event, keeping excitement simmering for what's next.
Mint
an hour ago
- Mint
Coach's Hit Handbag Shows How Less-Expensive Luxury Is Gaining Ground
(Bloomberg) -- Ultra-luxury is losing its luster — and mid-tier competitors are capitalizing. Industry bellwether LVMH Moët Hennessy Louis Vuitton SE, which reported weaker-than-expected sales in the latest quarter, was accused of selling a Dior bag that costs about $60 to make for $2,800. Meanwhile, Tapestry Inc.'s Coach is cashing in on cool with its $495 Tabby bag — a viral hit that costs a fraction of a similar shoulder bag from Dior or Chanel. That's just one example of how mid-tier luxury brands are weathering the current economic uncertainty better than their ultra-luxury and fast-fashion counterparts, as consumers seek quality and value without the sky-high prices amid a weaker global economy. 'There's a bit of a backlash going on,' said Fflur Roberts, head of luxury goods at Euromonitor International. Consumers are questioning the true value behind the price, including how items are made and the cost versus what they're really worth, she said. As wealthy consumers trade down, mid-tier brands are performing increasingly well. Tapestry, which also owns the Kate Spade and Stuart Weitzman brands, recently raised its forecast for the year after reporting quarterly results ahead of analyst estimates. Amer Sports Inc., which owns premium sportswear brands Salomon and Arc'teryx, also increased its projections for the full year, while Michael Kors owner Capri Holdings Ltd. and Hugo Boss AG both outperformed market expectations. Ralph Lauren Corp. is another winner, offering a broad price range and maintaining appeal through its classic design, according to Bloomberg Intelligence senior retail analyst Mary Ross Gilbert. Same-store sales rose 13% in the three months through March 29, nearly double what analysts expected. Meanwhile, luxury giants Hermès International SCA and Gucci owner Kering SA joined LVMH in disappointing investors in the most recent earnings season, while privately-held Chanel Ltd.'s profit plunged. On the other end of the spectrum, fast fashion also struggling. 'We've seen a more difficult environment,' said BI senior analyst Charles Allen. Higher Zara prices and fewer H&M promotions are deterring shoppers, he added. Zara owner Inditex SA, Hennes & Mauritz AB and Primark, owned by Associated British Foods Plc, all reported slower growth or missed targets, while JD Sports Fashion Plc's same-store sales fell 2% in the first quarter and are expected to drop again. Tariffs — a key reason for the luxury slowdown — leave retailers targeting value shoppers little wiggle room. Uniqlo owner Fast Retailing Co. already warned these could hurt future earnings, while H&M said it may raise prices to offset the impact, which could push shoppers further away. Still, some consumers may be returning to stores. Primark US sales grew in April — partly due to the Easter holiday shifting to the month — after shrinking the previous two months, according to observed sales data collected by Bloomberg. Meanwhile, US wages continued to grow in April, and the country is still at a full employment level with the unemployment rate at 4.2%. US spending in April, however, ground to a halt. 'If people have money and see something tempting, they'll spend,' Allen said. 'People don't always behave how they say they will.' --With assistance from Jeannette Neumann. More stories like this are available on
United News of India
an hour ago
- United News of India
Chinese delegation visits Tajikistan for international conference on Glacier's Preservation
Beijing/Dushanbe, June 1 (UNI) A Chinese delegation visited Tajikistan from Friday to Saturday and attended the High-Level International Conference on Glaciers' Preservation. The delegation was headed by Shen Yueyue, vice chairperson of the National Committee of the Chinese People's Political Consultative Conference and chairperson of the Good-Neighbourliness, Friendship and Cooperation Commission of the Shanghai Cooperation Organisation (SCO), who met Tajik President Emomali Rahmon, held talks with Faizali Idizoda, speaker of the lower house of the parliament, and attended the unveiling ceremony of the Health Express China-Tajikstan Blindness Prevention Center. Conveying Chinese President Xi Jinping's greetings to Rahmon, Shen said that under the strategic guidance of the two heads of state, the comprehensive strategic partnership between China and Tajikistan in the new era has maintained good momentum for growth. China is willing to work with Tajikistan to follow through on the important consensus reached by the two heads of state, and push for solid progress in building a China-Tajikistan community with a shared future, she said. Depicting China as a proactive participant and contributor in global ecological governance and glaciers' preservation, Shen voiced China's readiness to work with all parties to fulfill common but differentiated responsibilities, so as to build a clean and beautiful world. Asking Shen to extend his sincere greetings to Xi, Rahmon reiterated that Tajikistan actively participates in high-quality Belt and Road cooperation and firmly supports the three major global initiatives proposed by Xi, and pledged joint efforts to build the China-Central Asia mechanism. He also voiced willingness to work with China to deepen cooperation in various fields and international collaboration on issues including addressing climate change. UNI/XINHUA ANV SSP
