Hong Kong has claimed the top spot globally for IPO fundraising in the first half of 2025, with HK$107.1 billion raised. A total of 51 companies went public, generating HK$124 billion in total funds. Cornerstone investors played a key role, contributing 42% of the amount raised, with two-thirds of these funds coming from overseas institutions. Major listings such as CATL and Hengrui Pharmaceuticals attracted global investors like the Kuwait Investment Authority, Oaktree Capital, and UBS Asset Management.
Post-listing performance has been robust, with average returns of 10% on the first day, 17% after one month, and 41% after three months, far exceeding five-year averages. This growth is fueled by international investors reallocating funds from U.S. fixed-income markets to Hong Kong's attractively valued growth stocks, particularly in consumer goods, healthcare, and technology sectors.
Industry experts highlight several factors driving this resurgence. CICC Chairman Chen Liang noted the return of previously hesitant overseas investors, while UBS's Chen Ge emphasized the growing interest from sovereign wealth funds targeting industry leaders with sustainable profitability. Policy adjustments in mainland China and increasing global interest in AI-related opportunities have further boosted the market's appeal.
The active participation of cornerstone investors, who typically agree to hold shares for six to twelve months, has become a key validation signal for IPOs. For instance, European fund giant Schroders participated as a cornerstone investor for the first time, committing US$142 million to Sanhua Intelligent Controls' listing.
With at least 20 high-quality A-share companies planning Hong Kong IPOs and sustained interest from global institutional investors, Hong Kong's capital markets are well-positioned to maintain their leadership in IPO activity for the rest of 2025. The combination of reasonable valuations, strong growth potential, and increasing international participation suggests that the city's momentum in the global IPO market is likely to continue.
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