Opinion | IPO boom a stepping stone for Hong Kong to become region’s capital hub

About a year ago, the question was whether Hong Kong’s initial public offering (IPO) market could recapture its heyday. At the time, I wrote that a sustained recovery could restore sentiment, rekindle risk appetites and help channel capital to China’s most ambitious enterprises. Encouragingly, the recovery is well under way.

Hong Kong is on track to be the world’s top IPO venue this year. The renewed activity rests on strong foundations: access to the right sectors, regulatory reforms and deepening liquidity. It also signals Hong Kong’s ability to provide the capital for a transforming global economy.

The US$5.3 billion secondary listing by Contemporary Amperex Technology (CATL) in May – the largest globally this year – did more than raise funds. It confirmed Hong Kong’s importance in the global expansion of China’s industrial champions. More recently, Apple supplier Lens Technology took a similar route. Shein, the fast-fashion giant, is reportedly preparing to follow.

What is drawing these companies to Hong Kong over New York, London or Shanghai? Listing aspirants report faster approvals, clearer regulatory paths and access to both international and domestic capital in Hong Kong. Waiting times for A-share IPOs that can stretch a year or more led many would-be issuers to turn to Hong Kong. A more protectionist stance in the United States has also made its stock markets less appealing, particularly for Chinese and other emerging-market issuers.

Regulatory reforms – including lower thresholds that allow specialist technology firms to come to market sooner – have repositioned Hong Kong’s bourse as a platform for growth. The launch of the Technology Enterprises Channel this year, with tailored listing criteria for tech and biotech firms, will reinforce Hong Kong’s role as a platform for innovation.