Latest news with #Dealogic
The Sun
6 days ago
- Business
- The Sun
Global M&As surpass US$2.6 trillion year to date
LONDON: Global dealmaking has reached US$2.6 trillion (RM11 trillion), the highest for the first seven months of the year since the 2021 pandemic-era peak, as a quest for growth in corporate boardrooms and the impact of a surge in AI activity has overcome the uncertainty caused by US tariffs. The number of transactions to Aug 1 is 16% lower than the same time last year, but their value is 28% higher, according to Dealogic data, boosted by US megadeals valued at more than US$10 billion. They include Union Pacific Corp's proposed US$85 billion acquisition of small rival Norfolk Southern and OpenAI's US$40 billion funding round led by Softbank Group. The upsurge will be a relief to bankers who began the year with expectations the administration of US President Donald Trump would lead to a wave of consolidation. Instead, his trade tariffs and geopolitical uncertainty made companies pause until renewed confidence in corporate boardrooms and the US administration's anti-trust agenda changed the mood. 'What you're seeing in terms of deal rationale for transactions right now is that it's heavily growth-motivated, and it's increasing,' Andre Veissid, EY Global Financial Services Strategy and Transactions Leader, told Reuters. 'Whether it's artificial intelligence (AI), the change in the regulatory environment, we see our clients not wanting to be left behind in that race and that's driving activity.' Compared with August 2021, when investors, rebounding from pandemic lockdowns drove the value of deals to US$3.57 trillion, this year's tally is nearly a US$1 trillion, or 27%, lower. Still, deal-makers at JP Morgan Chase have said there is more to come, with companies pursuing bigger deals in the second half of the year as executives adapt to volatility. 'People have got used to the prevailing uncertainty, or maybe the unpredictability post-US election is just more predictable now,' Simon Nicholls, co-head of Slaughter and May Corporate and M&A group, said. Nigel Wellings, partner at Clifford Chance said the market was moving beyond tariffs. 'Boardrooms are seeing the M&A opportunity of a more stable economic environment and positive regulatory signals. But it is not a frothy market.' While the healthcare sector drove M&A in the years after the pandemic, the computer and electronics industry has produced more takeover bids in the US and the UK in the last two years, according to Dealogic. Artificial intelligence is expected to drive more dealmaking. M&A activity has increased around data centre usage, such as Samsung's US$1.7 billion acquisition of Germany's FlaktGroup, a data centre cooling specialist. Palo Alto Networks US$25 billion deal for Israeli cybersecurity peer CyberArk was the largest deal in Europe, Middle East and Africa so far this year as rising AI-driven threats push companies to adopt stronger defences. Private equity, which had been sitting on the sidelines, has once again been active, with Sycamore Partners' US$10 billion deal to take private Walgreens Boots Alliance and rivalling £4.8 billion (RM27 billion) offers from KKR and Advent for UK scientific instrument maker Spectris. The US was the biggest market for M&A, accounting for more than half of the global activity. Asia Pacific's dealmaking doubled over the same year to date period last year, outpacing the EMEA region.
Yahoo
29-07-2025
- Business
- Yahoo
IPOs are hot again. How investors can avoid a 2021 style hangover
Investors kicked off 2025 hoping to see the healthy return of what had become a rare species: the initial public offering, or IPO. After three years of stalled transactions and historically low deal activity, many believed the Trump administration would prioritize deregulation and economic growth, triggering a healthy flurry of new IPOs in the process. And indeed, that confidence led to the busiest start of a year for IPOs since the boom of 2020 and 2021. To be sure, after an initial burst of exuberance, March and April were rocky: A gale of macroeconomic forces—including tariffs and persistently high inflation and interest rates—led the pipeline to dry up as some firms put IPO plans on ice. In the late spring, though, equities rebounded, and the pulse of the IPO market picked up again. Volume reached a total of 103 IPOs in the first half of 2025 on U.S. exchanges, compared with 78 for the same period in 2024, according to Dealogic analysis. The largest IPO so far has been for Venture Global, a liquefied natural gas exporter, which successfully raised $1.75 billion in January; in all, the year's first-half IPOs raised $17 billion. (We offer outlooks on these pages for four of the most widely watched members of this year's IPO class.) Analysts and investors are optimistic that IPOs will remain strong into the fourth quarter, following a typical period of quiet through Labor Day. 'There's a lot of continued strong interest around IPOs from companies that we're speaking with,' says Rachel Gerring, EY Americas IPO leader. That's 'fueling optimism even beyond '25 into '26.' Many analysts now view the current market conditions as a return to form, and expect 2025 to be the best year for IPOs since 2021, another step in the slow and steady climb back to pre-COVID levels of activity. And that could provide plenty of opportunities for discerning investors. Encouraging signs Several recent high-profile success stories illustrate why some analysts remain bullish. A flashy debut from Circle Internet Group saw the stablecoin issuer trading up post-issuance, and the company has experienced an extraordinary surge since its June 5 IPO. Its share price opened at $69 before peaking at over $263 later in the month; in mid-July it hovered around $230, more than triple its IPO price. Circle's success likely caught the attention of other pre-IPO cryptocurrency companies like Gemini, an exchange that confidentially filed for its debut in June. CoreWeave, an AI infrastructure company, had a lackluster debut amid the broader tech selloff in March, but its share price in mid-July was up 231% since its offering, having climbed from $40 to $132. Others that listed in the first quarter have, of course, demonstrated less stellar post-offering performance. Still, analysts like what they see. Gerring notes that activity is nowhere near 2021 levels. That was a record-breaking year that preceded a sharp contraction—total U.S. IPOs fell from 908 that year to just 149 in 2022, according to S&P Global. There was historically low activity from 2022 to 2024—and that's a good thing, in Gerring's book. Instead of a repeat of a cycle of over-exuberance followed by a prolonged hangover, she sees the IPO market recalibrating to pre-2020 levels, though she adds it will take time to get there. 'We're not discouraged at all by the numbers and volumes that we're seeing,' Gerring says, especially given that 'there's something occurring almost every quarter that companies have to navigate, that kind of shocks the system.' One major difference between 2021 and now, says Mike Bellin, deals partner at PwC and leader of its U.S. IPO practice, is that companies coming to market this year are larger, have stronger growth fundamentals, and are more often profitable or on a path to profitability. That in turn can help performance not only at the IPO but after, which is what investors are looking for. 'There's a deeper pipeline of quality companies. But there are a lot of known unknowns.' 'There's momentum in the market,' says Bellin, which in turn 'opens the door further for some of the smaller, midcap-type companies that are in process and in the pipeline.' Another encouraging feature of the current environment is that companies across sectors are preparing for their IPOs. Technology and health care companies are leading the way this year, but firms from the realms of fintech, energy, and defense are also moving to go public. In any batch of IPOs, there will always be a select few that will be viewed fairly or not—by analysts and investors as best in breed. This year, the companies generating the most excitement about their potential debut on the public market include fintech company Klarna, digital design company Figma, payment processing company Stripe, and ticket exchange StubHub. The success of their offerings—and whether they happen at all—will depend of course, on macro-conditions. 'There's a deep pipeline of quality companies that are looking at the capital markets,' Bellin says. 'But there are a lot of known unknowns still in the market. I'll say the door's open for the IPO market in the second half of '25, but it's not wide open.' What investors need to know For the average retail investor, IPOs don't necessarily represent buying opportunities; because of lockup periods and other restrictions, it can be nearly impossible for outsiders to invest before companies' debuts, making any first-day pop in price moot for all but insiders and venture capitalists. Initial trading days can be extremely volatile, which won't appeal to long-term investors. And of course, a newly public stock can always tank. Concerns about the broader economy also affect the IPO market. Uncertainty is the overarching condition of 2025, the result in part of President Trump's evolving and often unpredictable policy preferences, the acceleration of AI, and geopolitical conflict in many parts of the world. Macroeconomic conditions are on every analyst's mind. That uncertainty, particularly related to tariffs, has prompted some companies that at one time planned to list in early 2025 to delay their entrances, at least until later in the year and possibly until early 2026, to see how the president's policies affect consumer spending, inflation, and interest rates. On the other hand, if Trump rethinks his tariff strategy and the Federal Reserve is able to cut benchmark rates this year, more IPOs will likely be on the horizon. 'The trade policy, if that starts to take a turn for the worse, that will ultimately shut down the IPO market,' says Bellin. On the other hand, he says, 'If we do continue to get good readouts from a macro perspective and limited geopolitical disruption, the capital markets will be an exciting place to be and to watch. This article appears in the August/September 2025 issue of Fortune with the headline 'Is it safe to get back in the IPO waters?' Fintech Chime Chime Financial is a fintech that provides banking services to lower-income U.S. consumers, in part through its mobile app, though it isn't a bank itself. It went public in June at an $11.6 billion valuation. While that's less than half of the $25 billion private market Chime boasted in 2021, analysts generally believe the company is in better shape than it was back then: Chime is now profitable, with 8.6 million active users. It has been criticized for its failure to diversify its finances. Much of Chime's revenue comes from interchange, the fee merchants pay when consumers use a Chime-issued debit or credit card. And it has lots of competition from rivals that are banks or fintechs offering similar services. —Luisa Beltran Bull case: Chime continues to grow its sticky user base to drive increased product adoption and expand. Bear case: Chime fails to expand its revenues beyond interchange, and its share price drops below its $27 IPO level. Crypto Circle Crypto may be known for extreme price swings, as investors leap in and out of assets like Bitcoin and Shiba Inu. But there's an increasingly popular option for those who want exposure to the sector without buying actual cryptocurrencies: Circle, a stablecoin company that issues a dollar-backed cryptocurrency, USD Coin (USDC). Ahead of its June IPO, analysts warned that Circle's core business—earning revenue off the interest from the assets backing USDC—did not offer much upside. But since then, the stock has behaved more like a cryptocurrency, with wild fluctuations including the biggest two-day pop of any major stock since 1980. —Leo Schwartz Bull case: Circle benefits from a broader crypto boom and thawing regulatory outlook, as more companies push into stablecoin adoption. Bear case: Circle's share price continues to drop back to earth, and the company continues to struggle with the same revenue-stream questions. AI Coreweave (CRWV) CoreWeave's tepid IPO meant little to investors who wanted apiece of one of the market's hottest trades: AI infrastructure (cloud-based, in CoreWeave's case). CoreWeave generated nearly $1 billion in revenue in its most recent quarter, and Nvidia and OpenAI are investors. In July, it agreed to buy data center provider Core Scientific for $9 billion in stock. In return, it would get about 1.3 gigawatts of power capacity and eliminate more than $10 billion in longterm lease obligations. CoreWeave is still highly leveraged, however. Analysts estimated it has between $12 billion and $17 billion in debt. Losses have increased, and CoreWeave is heavily reliant on Microsoft for revenue. —L.B. Bull case: Buying Core Scientific helps de-risk CoreWeave, and its financials improve. Bear case: AI adoption slows, and CoreWeave topples under its heavy debt load. Stock trading eToro When eToro went public in May, investors saw the trading platform's performance as a harbinger of whether the fintech IPO window would open back up. Its share price popped—and the window opened—but that doesn't necessarily make eToro a good investment. As a competitor to Robinhood, eToro offers an app-driven next generation alternative to stodgier brokerages like Schwab, providing experimental products like copy trading, where customers can mimic the investing behavior of other users, as well as an array of crypto assets. Bull case: eToro can ride the wave of interest in retail trading of riskier—and higher-upside—assets like crypto. Bear case: The platform fails to gain traction against larger rivals like Robinhood or well-heeled incumbents. This story was originally featured on Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Mint
26-07-2025
- Business
- Mint
The hottest business strategy this summer is buying crypto
It's the hottest trade of the summer. Companies are raising tens of billions of dollars, not to invest in their businesses or hire employees, but to purchase bitcoin and more obscure cryptocurrencies. A Japanese hotel operator, a French semiconductor manufacturer, a Florida toy maker, a nail-salon chain, an electric-bike maker—they're all plowing cash into tokens, helping to send all kinds of digital currencies to record levels. News that a new company plans to buy crypto is enough to send its shares flying—spurring others to consider joining the frenzy. Since June 1, 98 companies have announced plans to raise over $43 billion to buy bitcoin and other cryptocurrencies, according to Architect Partners, a crypto advisory firm. Nearly $86 billion has been raised for this purpose since the start of the year. That's more than double the amount of money raised in initial public offerings in the U.S. in 2025, according to Dealogic. Skeptics say the rush of companies buying crypto is a sign the market is overheating, noting that digital tokens, especially the obscure ones, are notoriously volatile and have uncertain futures. They scratch their heads about why an investor would buy shares of a company purchasing cryptocurrencies when they can buy them on their own through low-cost exchange-traded funds and other vehicles. Others note that many of these companies are worth much more than the cryptocurrencies they hold, as if investors are willing to pay $2 for a $1 bill. That hasn't stopped big-name bankers, investors and others from jumping in. Mutual-fund giant Capital Group, hedge fund D1 Capital Partners and investment bank Cantor Fitzgerald are among those backing recent efforts by companies to raise huge sums to purchase cryptocurrencies. Venture capitalist Peter Thiel's Founders Fund, Mike Novogratz's Galaxy Digital and other investors backed a move by a company called Bitmine Immersion Technologies to raise $250 million to buy ether. The company, worth $26 million on June 27, the Friday before its announcement, is now worth over $2 billion after a surge of more than 800%. Thiel, the tech billionaire known for starting PayPal and Palantir, holds a 9.1% stake in the company, according to a recent filing. He declined to comment. 'If you blink, you miss a couple of these deals," said Bob Diamond, the former Barclays chief executive. He should know. Last week, an investment firm Diamond co-founded called Atlas Merchant Capital said it was working with Paradigm, D1, Galaxy, 683 Capital and other big investors to form an entity that will spend $305 million to buy a seven-month-old crypto token called Hype. Diamond will be chairman of the new entity, while Eric Rosengren, the former president of the Boston Fed, is expected to be on its board of directors. 'We think Hype is pretty special," Diamond says. The new entrants are following in the footsteps of the company once known as MicroStrategy, whose CEO, Michael Saylor, pioneered the so-called crypto-treasury strategy in 2020. Now known simply as Strategy, it has spent years selling shares and debt to buy bitcoin. It is now worth over $115 billion, up 153% in the past year and 3,371% in the past five years. Saylor has long implored other companies to buy bitcoin with their excess cash. Most everyone ignored or scoffed at the notion. Using spare cash or raising money to buy volatile cryptocurrencies seemed a dicey proposition. Executives who run companies that sell products and services weren't supposed to speculate on bitcoin. As of last August, just a handful of companies were using their cash to buy any crypto. That all changed this year. President Trump has embraced crypto, vowing to make America the 'crypto capital of the planet." He has installed crypto-friendly cabinet members and Congress has advanced legislation that could make cryptocurrencies part of the mainstream financial system. Trump Media and Technology Group, the social-media firm controlled by the president's family, has also bought about $2 billion worth of bitcoin and related securities as part of its treasury strategy. Lately, companies have been taking things further than even Saylor suggested—buying overlooked or unknown digital currencies, not to diversify their holdings but to make outright wagers on risky tokens. Even Saylor is unsure that's a wise move. 'Applying a treasury strategy to other crypto assets introduces a different—and often speculative—risk profile," Saylor said in an email. 'I haven't seen a compelling rationale for doing so." Some bears are wading into the frenzy, including well-known short seller Jim Chanos, to bet against some of these companies. 'In my three decades experience I have never witnessed a period where investors are willing to pay such large premiums for assets they can readily purchase on their own," says Michael O'Rourke, chief market strategist at JonesTrading. Big companies, including tech giants Meta and Microsoft, have resisted the idea, as have their investors. Shareholder proposals at both companies sought to add bitcoin to their balance sheets at recent annual meetings, but were overwhelmingly voted down. Meta and Microsoft's boards of directors recommended voting against the proposals to invest in bitcoin. The companies that are taking the plunge are being transparent about their plans to raise cash and put it all in crypto. They argue that they can do things an ETF cannot, such as 'stake" tokens, or lock them up for a specified amount of time to earn a return. The companies can also borrow money to buy additional cryptocurrencies, something ETFs also can't do. Cryptocurrencies are volatile even in the best of times. If the price of a token plunges after a company has bet the farm, it could be left holding a worthless asset. Staking amplifies the risk, since it means an investor can't touch the locked-up tokens if they start to fall in value. And then there's the risk that investors sour on the strategy. Last week, Volcon, an electric-bike maker based in Austin, Texas, raised $500 million in just seven days to initiate its bitcoin treasury strategy, according to co-CEO Ryan Lane. Shares of Volcon jumped from $9.22 to more than $44 on the day of its announcement as speculators rushed to snap up the stock. Shares have fallen every day since, closing Friday at $13.40. Two weeks ago, French semiconductor manufacturer Sequans Communications raised $384 million from more than 40 institutional investors to buy bitcoin. The company's stock jumped 215% that week and peaked at $5.83 a share—but it's since fallen back down to $1.98. 'What happens in six, 12 or 18 months from now and instead of the current bull market, we have a bear market?" said Evgeny Gaevoy, the co-founder of crypto market-making firm Wintermute. 'A lot of low-effort crypto treasury companies will potentially crash and burn. And a lot of the retail investors that predominantly invested in them will be affected." Executives of some of the companies aren't waiting to see if their plans work out—they're dumping their personal shares after making the announcements, pocketing millions in the process. On June 16, for example, SRM Entertainment, a toy-and-souvenir manufacturer in Winter Park, Fla., with a market value of $25 million the Friday before, announced plans to spend $100 million on a cryptocurrency called Tron. The token purchase is part of a reverse merger between SRM and crypto entrepreneur Justin Sun's company, also called Tron. SRM's stock, which traded between 28 cents and $1.45 a share all year, shot up past $9. Over the next several days, the company's CEO, Richard Miller, and its chief financial officer, Douglas McKinnon, exercised previously issued stock options to buy a combined 600,000 shares at 56 cents a share, according to data from The Washington Service. They sold a combined $2 million or so of the newly acquired shares. A vice president of the company sold $941,000 worth of stock. Executives of the company, which has changed its name to Tron Inc. and rang the Nasdaq opening bell on Thursday, declined to comment. Lately, tiny companies are working with recognized names in finance to raise cash to buy crypto. Among them is Cantor Fitzgerald, run by Howard Lutnick before he became commerce secretary this year and passed the reins to his sons Brandon and Kyle Lutnick. Cantor last week said it would form a $5.3 billion bitcoin treasury company with Adam Back, an early cryptographer. It was Cantor's second multibillion-dollar crypto-treasury SPAC deal in less than three months. The firm also facilitated several other bitcoin treasury deals and acted as an adviser to Trump Media's plan to buy bitcoin. For now, many investors are scoring big profits betting on these deals, which remind some of the frenzied SPAC boom of the pandemic era, when established members of the financial world jumped on the wave. Fabio Giorno, an entrepreneur who operates a tutoring business in Toronto, says he has begun to invest in Bitmine and SharpLink Gaming, another ether-focused treasury stock. He's done well on the stocks, but says the volatility of the shares shakes him. 'Sometimes it's a little risky when you walk away from your computer, because you never know what's going to happen with the news," he said. Write to Gregory Zuckerman at and Vicky Ge Huang at
Observer
20-07-2025
- Business
- Observer
European banks grab market share from rivals
European investment banks have grabbed market share from their Wall Street rivals on their home turf as protectionist US policies have renewed focus on the continent. The top European investment banks secured around 55 per cent of the fee pool in their home market in the first six months of 2025. This was their biggest share of revenue in the region for nearly a decade, according to data provider Dealogic. It's a reversal of fortune for European investment banks, which have been losing ground to their US peers since the 2008 financial crisis. An expected boom in US dealmaking this year has not materialised, as US president Donald Trump's policies have created uncertainty in the market. Trump also announced back in April that he would impose steep import tariffs on US trading partners' goods. His 'Liberation Day' has already led to more deals being iced. The upheaval in the US has led to renewed optimism in Europe, with corporate embarking on deals and private equity firms looking further afield for investments. 'The shift from global investors to corporates to focus on the European market plays to our strengths in our home markets,' said Henrik Johnson, co-head of European investment banking at Deutsche Bank. Renaud-Franck Falce, head of Global Capital markets at BNP Paribas, said the recent shift towards Europe being forced to stand on its own two feet is likely to lead to a surge in dealmaking in the region. 'Europe's push towards greater autonomy is expected to translate into an investment 'super cycle' requiring large financing solutions and to accelerate cross-boarder M&A within Europe,' he said. 'Broad access to capital markets, moderate leverage in corporate Europe and significant private equity dry powder will support such moves.' Dealmakers had predicted a bumper 2025 fuelled by 'Trump 2.0', which would usher in a new business friendly era with light-touch M&A regulation. However, US policy has instead led to more protectionism and volatile market reaction has scuppered appetite for deals. Investment banking fees are down globally by 4 per cent at $34.4bn so far in 2025, according to Dealogic. JPMorgan's chief executive Jamie Dimon signalled that dealmaking revenue could be down by mid-teen percentages in the second quarter. European investment banking fees are down by 12pc this year, despite the increase in optimism around activity. JPMorgan added more than 300 people to its EU hub in 2024, with Paris the main beneficiary as it continues to hire in the French capital. The bank ended 2024 with 4,956 people within JPMorgan SE – the entity created to house its EU operations after Brexit – up to 307, according to its newly released annual report. Like its rivals, JPMorgan has been bolstering its operations in the EU in recent years following the UK's formal exit from the bloc in 2020. The Wall Street bank expanded its Paris office by 105 people last year, the figure shows, an increase of 15 per cent compared with a year earlier. BNP Paribas's Falce said: 'We fully anticipate dealmaking activity will increase in Europe, notably in sectors related to security, sustainability and electricity transmission, as well as digital infrastructure.' Ready to fight giants: European banks dominated their home turfs before the 2008 financial crisis. Deutsche Bank and Barclays were among those that embarked on a quest to become global players and take on Wall Street giants in the US. However, a prolonged period of low interest rates and a slower recovery from the crisis saw some European banks fall behind. Their share of the European investment banking fee pool has been slowly eroded since hitting a peak of 65 per cent in 2010, according to Dealogic numbers. Andy Jalil The writer is our foreign correspondent based in the UK
Business Times
20-07-2025
- Business
- Business Times
Chinese mega listings catapult Hong Kong to top spot in global markets for IPOs in H1 2025
[HONG KONG] A parade of China's mega listings in Hong Kong since the turn of the year has helped restore some of the shine to the city as the world's largest fundraising destination for initial public offerings (IPOs). A significantly large number of Chinese firms seeking stock listings in Hong Kong, along with a rush of capital inflows from the mainland, has created a convergence of Chinese finance in the city. Fundraising in Hong Kong through IPOs reached HK$107.1 billion (S$17.5 billion) from 44 listings in the first six months of the year, far surpassing both the Nasdaq and the New York Stock Exchange (NYSE), according to data from the Hong Kong Stock Exchange (HKEX). This sent HKEX to the top of global exchanges for H1 2025, representing its best mid-year performance sine 2016. A spokesperson for the exchange, citing confirmation from several data providers including Dealogic, KPMG and EY, told The Business Times that its IPO fundraising in H1 put it at the top of global IPO rankings. The top listing on HKEX during this period was the US$5.3 billion IPO of China's largest battery maker Contemporary Amperex Technology in May. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up This was followed by the HK$9.9 billion raised by Chinese drugmaker Jiangsu Hengrui Pharmaceuticals, which also took place in May, and the HK$9.4 billion IPO in June staged by China's largest condiment maker, Foshan Haitian Flavouring & Food. Hong Kong has long been in an intense tussle with Shanghai for the title of being China's primary funding source, and it seems that Hong Kong has the upper hand for now. As at Jul 8, Dealogic's team counted 184 planned IPOs in Hong Kong, all of which were from the city and the mainland, with the exception of two from the Cayman Islands, and one each from Malaysia, Singapore and the United Arab Emirates. Of the planned IPOs, 49 belong to the technology sector. Perris Lee, head of convertible bonds and Asia-Pacific equity capital markets at Ion Analytics, the parent company of Dealogic, said: 'At this point, we can say with much certainty that technology stocks will be central to many of the Hong Kong IPOs in the queue, thanks in no small part to (Chinese artificial intelligence company) DeepSeek.' He attributes the recent strong rally in Hong Kong stocks to a Deepseek-inspired optimism that may also spill over to industries such as healthcare and consumer-related businesses. The hectic pace of fundraising is also supported by what analysts call 'homecoming' listings by mainland Chinese companies with stocks already listed elsewhere outside the mainland, primarily in the US. Lee said that, given a US-China relationship that has been 'polite' at best in recent years, there have been many such homecoming listings in Hong Kong and China by US-listed Chinese companies. 'Many of the US-listed companies that should or could seek a secondary listing have done so,' he said. 'Only a few remain on the drawing board.' In particular, he named technology giant Alibaba and electric vehicle (EV) maker Xpeng. 'These two deals were significant in many ways. One key aspect is that they were doing a dual primary listing in Hong Kong, rather than a secondary listing. Dual primary listings subject the companies to strict regulations in both the US and Hong Kong.' The immediate prospects are brightened by a long listing pipeline stretching well into the coming year. HKEX said it had given regulatory approval to 16 companies, with the applications of 176 companies currently 'under processing' as at Jun 30. Against this background, analysts said there is a far greater cascading of southbound net capital inflows into Hong Kong's stock market. James Wang, head of China strategy at investment bank UBS Global Research, said the total amount raised this year in IPOs was dwarfed when compared with its peak reached in 2020, as well as with the unprecedented southbound net inflows this year. In the first quarter alone, these hit HK$400 billion, the highest in history. Wang attributed this to the improved quality and vintage of companies listed in Hong Kong, tighter IPO restrictions in mainland China, improved liquidity in Hong Kong and a greater appetite for core Chinese assets from foreign investors for stocks such as EV car leader BYD, Tencent and Alibaba – basically global champions and top AI players. Southbound net inflows reached US$80 billion at the end of May, according to a chart released by Morgan Stanley. However, the pace had slowed down in that month, following a period of strong inflows from January to late April. To put things into perspective, a survey released in June by Deloitte China's Capital Market Services Group showed the IPO funds raised in Hong Kong this year exceeded those raised by Nasdaq and the NYSE by HK$31 billion and HK$43 billion, respectively. Of the 40 listings tracked by Deloitte in Hong Kong in H1, only two IPOs were staged by companies from outside China: one from Singapore and the other from Indonesia. 'National support for and emphasis on developing the technology and innovative sectors will encourage new quality productivity forces such as technology and new energy companies to raise funds in the capital market and enter the market spotlight in the second half of 2025,' said Tony Huang, national A-Share offering leader, capital market services group, Deloitte China. Deloitte expects companies to raise HK$200 billion in IPOs in Hong Kong by the end of the year, through 80 listings. There are potentially 25 IPOs from companies already listed on the mainland's A-shares market. Deloitte said that most of Hong Kong's new listings will come from the technology, media and telecommunications sectors, as well as consumer companies.
