Continuing to Attract Global Investors

Diversified investment themes and optimized market mechanisms are positioning Hong Kong stocks as a key destination for global capital allocation.

This year, foreign institutions have actively subscribed to cornerstone investments in HK IPOs. For instance, Lens Technology’s July 9 listing attracted UBS Global Asset Management (Singapore) and Oaktree Capital as cornerstone investors.

Goldman Sachs’ mid-July report noted HK IPOs draw hedge funds, mutual funds, pensions, sovereign wealth funds, and retail investors. Cornerstone investors—committing large pre-IPO subscriptions with 3-6 month lock-ups—play a pivotal role.

Per Shenwan Hongyuan Securities, foreign cornerstone investors primarily include UK/US/Singapore-based asset managers, Middle Eastern sovereign funds, and Southeast Asian family offices.

"Deep participation from these investors enhances IPO stability while boosting liquidity and attention," said Goldman’s China equity strategist Kinger Lau.

Goldman estimates cornerstone investors hold 10%-80% in recent HK IPOs, accounting for 42% of total fundraising this year—two-thirds from overseas.

Lau added that AI optimism has reignited global interest in Chinese markets, driving demand for growth-oriented yet reasonably valued HK listings.

Beyond IPOs, global investors engage in placements and convertible bonds. Examples:

• Innosilicon’s July 22 H-share placement (13.58M shares) was oversubscribed by long-term funds;

• Sinopec Group’s HK$7.75B convertible bond (May) attracted top-tier offshore institutions.

UBS Wealth Management’s Jerry Lu stated: "Dual A+H listings create win-wins—firms raise capital via H-shares, while investors access previously hard-to-reach assets." He highlighted rebounding foreign inflows after three years of under-allocation, with active participation in cornerstones, placements, and secondary trading.

A more balanced market structure enhances HK’s appeal. CICC’s Liu Gang noted manufacturing leaders’ listings this year address historical sector biases (e.g., tech hardware), solidifying HK’s role as China’s offshore asset hub and "super-connector." CICC projects H2 IPO/placement volumes may hit HK$300B, potentially outpacing H1.