Hong Kong’s capital markets have raised more than US$92 billion this year, driven by a surge in artificial intelligence-related deals that pushed third-quarter fundraising to a record for the period.
Initial public offerings, share placements and block trades raised US$47.5 billion between July and September, the largest quarterly haul ever recorded for the summer period, according to data compiled by Bloomberg.
The latest figures put Hong Kong within reach of its annual fundraising record of US$112.5 billion, set in 2021. However, rising bond yields and weak performance among some recent deals are prompting investors and companies to become more cautious.
AI has been a major driver of the revival, with Chinese technology companies raising increasingly large sums to fund expansion in the sector. Alibaba Group’s US$10.2 billion follow-on offering was the largest transaction during the third quarter, while Zhongji Innolight raised nearly US$8 billion in Hong Kong’s biggest listing in almost seven years.
AI model developer Z.AI has raised US$9.6 billion this year through its IPO, share placements and convertible bonds, while other AI companies have returned to the market soon after their IPO lock-up periods ended.
Bloomberg reported that Asia-Pacific share sales exceeded US$120 billion in the third quarter, the strongest third-quarter performance in six years, as the fundraising boom extended beyond Hong Kong.
Despite the strong pipeline, market conditions have become more challenging. Only two of Hong Kong’s 10 largest deals since July were trading above their offer prices, raising concerns about investor appetite heading into the final quarter.
Bankers expect fundraising activity to remain strong, but investors are likely to become more selective as companies compete for capital and concerns over the returns from heavy AI spending persist.
