The Hong Kong initial public offering market opened the year on a strong note, as January has been a very robust month for debuts, with the momentum stemming from positive market sentiment and a strong pipeline following stellar results in 2025.
By the end of January, 13 new IPOs had listed on the Hong Kong bourse, representing a year-on-year increase of 62.5 percent, said Hong Kong Exchanges and Clearing Ltd (HKEX). Total proceeds reached approximately HK $39.3 billion ($5.03 billion), up 556.2 percent from a year earlier and marking the strongest January fundraising performance on record.
Artificial intelligence tech companies led the way. Two of the Chinese mainland's largest generative AI startups, MiniMax and Zhipu, coupled with AI chipmakers Biren and Iluvatar CoreX, made dazzling debuts in January, collectively raising nearly HK $20 billion.
Ning Bo, director of the equity research department at China Merchants Securities (HK), said the city has built a complete AI industry chain ecosystem, spanning underlying computing hardware, foundation models and vertical applications.
This ecosystem can generate new markets through technological innovation, creating a supply-led demand dynamic that is expected to attract sustained medium-to-long-term capital inflows and support valuation re-rating, Ning said.
He pointed out that the benchmark Hang Seng Index is currently trading at a price-to-earnings ratio of a multiple of 12, with a return on equity of about 10.7 percent, indicating clear undervaluation. With continued southbound and overseas capital inflows, Ning expects the index to rise roughly 15 percent in 2026.
According to HKEX, 440 companies were in the listing pipeline as of end-January, of which 26 have been approved and are awaiting listing, while the remaining 414 are still under review.
Amid the IPO boom, regulators have intensified scrutiny to ensure listing quality and safeguard Hong Kong's status as an international financial hub.
On Jan 30, the Securities and Futures Commission (SFC) of Hong Kong highlighted in a circular serious deficiencies in the preparation of some listing documents, sponsors' potential misconduct and significant mismanagement of resources amidst a surge in new listing applications in 2025.
The circular also found that some sponsors were unfamiliar with regulatory requirements and lack experience and resources to handle applications. By the end of 2025, the SFC had required 13 sponsors to conduct comprehensive reviews within three months.
According to SFC CEO Julia Leung Fung-yee, 13 sponsors accounted for approximately 70 percent of the market's IPO projects, involving 433 IPO applications.
"The gatekeeping role of sponsors in the listing process is critical to maintaining the quality of Hong Kong's capital market and sustaining investor confidence in new listings that will hold up through all market cycles," Leung said.
She urged all sponsors and external professional parties involved in the listing application process to uphold the quality of their work in order to maintain Hong Kong as a leading international fundraising center.
Ning said such regulatory measures should help moderate the pace of IPOs and alleviate liquidity pressures more effectively. He expects the tighter oversight will also prompt mainland regulators to raise the bar on financial and market-capitalization thresholds for companies seeking to list in Hong Kong, ultimately drawing more high-quality issuers to the city.
Hong Kong reclaimed the world's top spot for IPOs in 2025 after a slump since its 2021 peak.
