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Hong Kong’s IPO market is expected to stay robust this year, with fundraising likely to see further growth, according to Janice Hu, president of UBS’s China division. The Hong Kong Stock Exchange outperformed others globally last year in IPO proceeds.
This year, the number of companies listing in Hong Kong is anticipated to range from 150 to 200, with total funds raised surpassing HKD 300 billion (roughly USD 38.5 billion). Hu, who also serves as chairwoman of UBS Securities, spoke during a media event yesterday, emphasizing that Hong Kong’s position as a leading global financial hub and a strong pipeline of potential IPOs will continue to drive market enthusiasm.
Last year, the exchange hosted 117 new listings, raising HKD 285.7 billion, marking a 67% and 224% increase from 2024, respectively, solidifying its status as the top global exchange by IPO fundraising volume.
Hu explained that the surge in IPO activity is driven by improved market liquidity, ongoing policy and regulatory enhancements, and a geopolitical landscape that proved more stable than initially expected.
Hong Kong remains a crucial link connecting Chinese companies with international investors. Recent years have seen a significant rise in Chinese firms seeking overseas expansion, while global investors increasingly look for diversified assets and reevaluate Chinese holdings.
The IPO boom has also sparked greater institutional interest in becoming cornerstone investors. Under current rules, these investors agree to purchase a set number of shares at the initial offering price before listing and commit to a lock-up period of six to twelve months.
Previously, some institutions were hesitant about the lock-up, but attitudes have shifted, with many, including sovereign wealth funds, now eager to participate as cornerstone investors. This shift has provided issuers with more options in selecting institutional partners, Hu noted.
Additionally, Hong Kong IPOs are seeing a more diverse group of cornerstone investors, particularly from Europe, Asia, and the Middle East, who are showing strong subscription interest, according to Chen Ge, co-head of UBS Securities’ global investment banking division.
The flow of foreign capital into Hong Kong’s markets continues to accelerate, boosted by ongoing support from southbound funds from mainland China, which has further enhanced liquidity conditions, Chen added.
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