Goldman Sachs: Strong recovery in Hong Kong's IPO market is expected to raise US$60 billion in 2026
The Zhitong Finance App learned that a research report released by Goldman Sachs indicates that after years of downturn, the Hong Kong initial public offering market will rebound strongly in 2025 and continue to accelerate in 2026. According to the report, 119 companies went public in 2025, raising a total of 37 billion US dollars in capital. In the first half of 2026, 84 companies will go public and raise 27 billion US dollars. The annual capital raising amount is expected to reach 60 billion US dollars, indicating a significant recovery in market vitality.
The report's analysis indicates that this recovery is not only cyclical, but also driven by various macro, regulatory, and structural factors. At the end of 2024, policy changes fueled a rebound in the Hong Kong stock market and reignited companies' willingness to finance. Meanwhile, the implementation of the “Nine Measures” by the China Securities Regulatory Commission has slowed down initial public offering of A-shares, prompted more mainland companies to switch to Hong Kong as a listing channel, and promoted a wave of dual A-share and H-share listings. In addition, the Hong Kong Stock Exchange has introduced a number of facilitation measures, including allowing professional technology companies to submit confidential forms and optimizing the application process to further attract companies from new economies to go public in Hong Kong.
The performance after the IPO was also quite outstanding. New stocks between 2025 and 2026 will achieve a median return of about 20% within the first three months of listing, with an average return of 60%, far exceeding previous years. According to the report, most of the new stocks that have performed well are large independent listed companies, concentrated in high-growth industries. The holders are about 30% to 50% of cornerstone investors, indicating that institutional support has a positive impact on stock prices.
Looking ahead, the market has sufficient liquidity and is expected to continue to support IPO activities. The report estimates that by 2026, the total equity supply will reach US$110 billion, including US$60 billion in initial public offering financing and US$50 billion in post-listing refinancing, which will be absorbed through multi-channel demand, including corporate dividends and repurchases (US$180 billion), global long-term capital reallocation (US$200 billion to US$30 billion), and southbound capital inflows (US$200 billion). Although $230 billion of restricted stocks will be released in the next 12 months, the potential inclusion of the index and the expansion of the Shanghai-Hong Kong Stock Connect and the Shenzhen-Hong Kong Stock Connect may bring about passive and mainland capital inflows, creating an important liquidity buffer and easing selling pressure.
The recovery in the IPO market has also brought new opportunities for financial institutions. According to the report, this has effectively reopened exit channels for financial investors, mitigated the mainland's liquidity crunch, and once again accelerated private equity investment in China. In the secondary market, the Hong Kong Stock Exchange (00388) and Chinese brokerage firms with strong overseas operations will benefit from a recovery in major listing activities, while also creating opportunities for institutional investors to capture excess returns and optimize investment portfolios.
The report concludes that a rebound in IPO activity usually boosts overall market sentiment and attracts global asset allocation capital inflows. Currently, more and more global sovereign wealth funds and pension funds are participating in Hong Kong IPOs as cornerstone investors, reflecting the growing confidence of international investors in the market. This trend is expected to continue to support the development of the Hong Kong stock market.