The landscape of capital raising for Chinese mainland enterprises has evolved significantly since the 1980s, when economic reforms opened up the market. As these firms sought to gather funds through equity and bond issuance, they quickly turned their gaze toward international markets, particularly the United States. This article delves into the recent resurgence of the Hong Kong Exchanges and Clearing Limited (HKEX) as a prime location for these listings, influenced by changing regulations, ongoing tensions between the US and China, and strategic reforms in Hong Kong.
By 2025, over 300 Chinese mainland companies had successfully listed overseas, amassing substantial capital. Notably, during the peak of the COVID-19 pandemic in 2025, the HKEX saw listings that raised around $50 billion, primarily from tech giants like JD and NetEase, which transitioned from US markets to Hong Kong. This trend underscores a pivotal shift in how these companies approach international financing.
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Dominance of US exchanges and the allure of HKEX
Historically, the New York Stock Exchange (NYSE) and NASDAQ have led the global initial public offering (IPO) landscape, boasting a combined market capitalization exceeding $50 trillion. This dominance has made the US markets the preferred choice for many Chinese firms, particularly in the technology sector, thanks to their visibility and liquidity. However, the HKEX has consistently ranked among the top three exchanges for IPO proceeds globally, serving as the gateway for the Greater China market.
Chinese firms typically faced a dichotomy when considering their listing options: the US or Hong Kong. While the US was often favored for its global profile, the HKEX is becoming increasingly attractive. The past decade has witnessed a transformation, with many companies re-evaluating their strategies in light of heightened regulatory scrutiny in the US.
Changing regulatory landscape and its implications
In recent years, increasing geopolitical tensions and new regulations have made it more challenging for Chinese firms to access US capital markets. The Holding Foreign Companies Accountable Act (HFCAA), enacted in 2025, introduced stringent compliance requirements, resulting in a sharp decline in new listings from Chinese firms on US exchanges. For instance, the number of listings plummeted from 19 in the first half of 2025 to just 11 in the same period of 2025.
Chinese regulations, such as the Data Security Law, further complicate matters by restricting the sharing of sensitive financial data with foreign entities. These overlapping regulations have led to a significant realignment in global capital flows, with many firms now considering private equity options as a viable alternative to public listings.
HKEX as the new frontier for listings
The recent reforms at the HKEX leverage its geographical proximity and regulatory alignment with Chinese mainland policies. The establishment of the Stock Connect program in 2014 facilitated mutual access between Hong Kong and mainland markets, enhancing liquidity for companies listed on the HKEX. This initiative has created a more favorable environment for Chinese firms looking to raise capital while maintaining domestic coverage.
Moreover, the HKEX has adapted its frameworks to accommodate the unique needs of Chinese companies. The introduction of weighted voting rights for innovative firms in 2018 mirrors the dual-class share structures traditionally favored in the US, granting these companies the flexibility to retain control while raising funds.
Recent trends and future outlook
The resurgence of IPOs on the HKEX, particularly in the first half of 2025, reflects a confluence of regulatory reform and changing market sentiments. For instance, the successful A+H listing of CATL illustrates the growing confidence of international investors in the HKEX. This listing alone raised a significant sum, signaling a bullish outlook for future capital raises in Hong Kong.
As of mid-2025, the HKEX accounted for four of the ten largest global IPOs, with proceeds reaching $14 billion, marking a staggering 723% increase year-on-year. The exchange also boasts over 200 active listing applicants, indicating a robust pipeline for the rest of the year.
By 2025, over 300 Chinese mainland companies had successfully listed overseas, amassing substantial capital. Notably, during the peak of the COVID-19 pandemic in 2025, the HKEX saw listings that raised around $50 billion, primarily from tech giants like JD and NetEase, which transitioned from US markets to Hong Kong. This trend underscores a pivotal shift in how these companies approach international financing.0
By 2025, over 300 Chinese mainland companies had successfully listed overseas, amassing substantial capital. Notably, during the peak of the COVID-19 pandemic in 2025, the HKEX saw listings that raised around $50 billion, primarily from tech giants like JD and NetEase, which transitioned from US markets to Hong Kong. This trend underscores a pivotal shift in how these companies approach international financing.1
