With overseas listings of Chinese companies heating up recently, the market is increasingly optimistic that Hong Kong and the U. S. stock markets will see more Chinese listings. Some analysts believe the high-profile listings of some Chinese stocks this year have boosted investor optimism. Under the influence of the Chinese government’s announcement of economic stimulus measures, its policy of supporting domestic companies to list overseas and the US Federal Reserve’s interest rate cut, the number of Chinese ipos in the US and initial public offering is set to increase next year.
The market is optimistic about Chinese Enterprises’ overseas IPO in 2025
Chinese self-driving company Wen yuanzhixing rose 6.8 percent on its first day of trading on NASDAQ on Friday. Earlier this month, Chinese self-driving taxi operator Xiao Chik? also filed for a NASDAQ listing. Also last week, Chinese artificial intelligence and automotive chip developer Horizon Robot and bottled water company China Resources Beverage were successfully listed in Hong Kong. Analysts say most of the companies planning to go public are in the life sciences, technology or consumer sectors. Many Chinese companies are planning to go public, making many investors very optimistic about next year.
According to CNBC, there have been few large Chinese ipos in New Didi since the summer of 2021. US and Chinese regulators have both stepped up their scrutiny of such listings, although us and Chinese authorities have since clarified the process for listing Chinese companies in New York, but geopolitical and market changes have sharply reduced the number of Chinese ipos in the US.
After years of gloom, the IPO market is widely expected to recover next year, the report quoted Ellis, Global co-chairman of the private equity practice of US law firm Mayfair, as saying, mainly because of the Federal Reserve into the interest rate cut channel and the U. S. presidential election dust settled. Elise also believes that while there are still some concerns about the regulatory issues between China and the US, many specific issues have been resolved.
Yang delong, chief economist of Qianhai Open Source Fund, told the Global Times on the 30th that ipos of Hong Kong stocks and Chinese enterprises in the United States have been relatively intensive recently, which is a very good signal, it shows that the pace of Chinese enterprises going out is accelerating. Xu Weihong, vice president of Yongxing Securities, told the global times that China’s technological innovation in all fields has been booming, with a large number of start-ups growing and seeking ipos at the right time, the IPO market in Hong Kong and the United States continues to inject new momentum.
As its appeal grows, hkex plots the Middle East
So far this year, 42 companies have listed in Hong Kong, according to the Hong Kong Stock Exchange. At the end of the third quarter, there were still 96 IPO applications pending or being processed. Synagistics, a Southeast Asian e-commerce platform backed by Ali, listed on the Hong Kong Stock Exchange Wednesday through backdoor SPAC (Special Purpose buy-out Company) .
Horizon and China Resources have landed the biggest ipos on the Hong Kong Stock Exchange this year, according to Renaissance Capital, which tracks global ipos. Chinese express giant SF Express plans to list in Hong Kong next month, while carmaker Chery plans to list in the city next year, the information said.
Speaking at a forum at the Future Investment Initiative Conference in Riyadh, Saudi Arabia, the chief executive of the Hong Kong Stock Exchange, Chen Yiting, said that although the new stock market activity in Hong Kong has not returned to its 2021 level, but it has entered the stage of re-opening.
KPMG, an international Accounting networks and associations, said in its third-quarter review of IPOS in China and Hong Kong that the 2024 had returned to the top five global markets for ipos, the first three quarters of IPO volume reached $7.2 billion. Especially in the third quarter, the Hong Kong market picked up the momentum and ushered in the largest IPO in three years. Nearly 100 IPO applications are still being processed by hkex, with the most active sectors being information technology, media and telecommunications, followed by healthcare and life sciences.
KPMG officials told the global times that investors were regaining confidence and interest in the Hong Kong IPO market. Chinese and Hong Kong stocks posted their biggest weekly gains in recent memory last week, helped by Beijing’s latest economic stimulus measures. The strategic move is expected to attract more capital inflows, which in turn will boost the number of large ipos in Hong Kong this year and in the future. These positive factors are expected to continue to drive IPO activity, solidify Hong Kong’s position in the global IPO rankings and demonstrate its resilience and attractiveness as a leading capital raising centre.
As it prepares for more ipos, the Hong Kong Exchange is plotting further afield. The Hong Kong Stock Exchange announced on its website yesterday that it plans to open an office in Riyadh by 2025. The new office will strengthen HKEX’s presence in the Middle East, promote links between China and the Middle East Gulf region and create new opportunities for global clients and issuers.
“Hong Kong, then New York.”
Ms Ellis told CNBC that geopolitical tensions had made Hong Kong the market of choice for Chinese companies, but the depth and breadth of us capital markets still led many companies to seriously consider the possibility of an IPO in the US.
“Zero per cent of Chinese companies chose to list in Hong Kong to test the interest of investors from other countries,” the CNBC report quoted Li Zibin, vice-president of global asset data and market analysis Greater China, as saying, global Investors, previously keen to put money into India and the Middle East, are now turning to China. “Right now investors are looking at China again and see more potential in China,” CNBC reported, adding that the revival of Chinese ipos in the US and Hong Kong would help cash out early-stage investments in start-ups.
In April this year, the China Securities Regulatory Commission (CSRC) proposed in its“16 measures for the high-level development of technology enterprises in the capital market” that it support technology-based enterprises to list overseas according to laws and regulations, we will implement the management system for the filing of overseas listings and better support the development of overseas listing and financing for technology-based enterprises. IPO data showed that the number of Chinese companies 2024 to the US increased significantly in the first three quarters of the year, with most raising $1m in new shares, making the US market a popular alternative to a-share listings. Market institutions believe that the US Federal Reserve’s interest rate cut and the introduction of China’s policy of supporting qualified technology companies to list overseas will push Chinese companies to list in the US, especially from the tech industry.
Yasunaga, an international Accounting networks and associations, said more than half of all ipos in the US since the 2023 had come from foreign companies, a 20-year high. According to Ernst & Young’s main list of cross-border ipos, both Geely’s Chinese Electric Car Company Extreme Krypton and Anta’s Yamafen sports completed listings in the US earlier this year. In addition, Weidu technology, a Chinese electric truck maker, said it planned to list in the US in the first half of 2025.
Xu said that while the US has been cracking down on Chinese high-tech, the US capital market is still very welcoming to Chinese start-ups, which are very growth-oriented and also benefit US investors. However, Xu Weihong also admitted that the future trend of Chinese ipos in the United States will still be limited by the U. S. policy toward China.