Hong Kong’s equity capital markets bounce back in first half, as Shein IPO looms

Hong Kong’s equity capital markets have experienced a resurgence in the first half of 2025, propelled by a renewed interest from global investors eyeing opportunities in China. This surge in activity comes as anticipation builds for the potential Shein initial public offering set to take place in the second half of the year.

The revival of Hong Kong’s markets has been fueled by a series of high-profile capital raisings and a flurry of “A to H” share deals, where companies already listed on mainland Chinese markets seek a secondary listing in Hong Kong. These developments have led to the strongest first half performance since 2021.

One of the most anticipated listings on the horizon is that of fast fashion giant Shein, which is reportedly working towards a listing in Hong Kong before the year’s end. This move is seen as crucial in restoring Hong Kong’s reputation as a global fundraising hub, especially amidst the uncertainty caused by shifts in U.S. trade policies.

Despite ongoing tariff negotiations between China and the United States, Hong Kong’s Hang Seng Index has seen a remarkable 21.2% increase year-to-date, positioning it as one of the top-performing major markets globally.

James Wang, head of Asia ex-Japan equity capital markets at Goldman Sachs, noted the shifting dynamics in the global investment landscape, highlighting a trend of capital outflow from the U.S. towards the Asian region. This structural change has presented investors with a wider range of investment opportunities.

According to data from LSEG, total equity issuance across Asia, including Japan, saw a 15.3% increase in the first half of 2025, amounting to $116.2 billion compared to $100.7 billion in the same period last year. In Hong Kong specifically, there was a substantial uptick in proceeds from IPOs and second listings, totaling $12.8 billion in the first half.

While the $2.9 billion raised from IPOs in Hong Kong during this period marked an improvement from the previous year, it still fell short of the $8.5 billion raised on the Nasdaq in New York. This discrepancy reflects investor caution in buying into IPOs amidst ongoing market volatility.

Global investors have re-entered the Chinese market, participating in major deals such as battery maker CATL’s $5.3 billion listing and the combined $11 billion raised by electric vehicle makers Xiaomi and BYD. These transactions have been instrumental in driving equity activity in the region.

Looking ahead, market experts are optimistic about the potential for continued growth in Hong Kong’s equity capital markets. With supportive policy measures in place and a resilient economy, China remains a key player in the global economic landscape.

Goldman Sachs emerged as the top performer in Asia’s equity capital market league tables for the first half of 2025, surpassing competitors like Morgan Stanley and JPMorgan. This success underscores the increasing momentum and investor interest in the region.

In conclusion, Hong Kong’s equity capital markets have seen a remarkable resurgence in the first half of 2025, propelled by a series of high-profile listings and a growing appetite from global investors. The upcoming Shein IPO and continued market activity signal a promising outlook for the region’s fundraising landscape.

(Reporting by Scott Murdoch in Sydney; Editing by Jamie Freed)