Hong Kong’s IPO market to end 3-year slump amid China support, rising confidence

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The city has recorded US$10.7 billion of proceeds from 64 IPOs this year through November; more deals in December

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Investors are more confident about the city’s market outlook, analysts say. Photo: Edmond So

Mia Castagnone

Published: 5:30pm, 11 Dec 2024

Initial public offerings (IPOs) in Hong Kong are bouncing back, shaking off a slow start to the year as more Chinese companies turned to the city to raise capital and global investors grew bullish after Beijing pledged to rescue the nation’s stock and property market.

Fundraising reached HK$83.4 billion (US$10.7 billion) this year through November 30, according to data compiled by EY, an increase of 80 per cent from a year earlier. The local IPO market slumped for a third straight year in 2023 when volume dropped to US$5.9 billion, according to LSE Group data.

Globally, companies have completed 1,162 IPOs this year involving US$117.3 billion of proceeds, representing a 14 per cent and 7 per cent decrease, respectively, it added.

Growing confidence among investors in Hong Kong has helped lure several attractive and jumbo IPOs to the market, according to Louis Lau, partner at Hong Kong capital markets group KPMG China, including Midea Group’s US$3.98 billion offering in September and SF Holding’s US$793 million deal in November.

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The second-half charge helped pull the market from a slumber, when IPO proceeds in the city slumped to a two-decade low and its ranking fell to 13th globally. While IPOs in Hong Kong could rise to HK$120 billion next year, India and the US are likely to remain among the top three venues, KPMG said.