Capital Raising - Hong Kong

Hong Kong

The country in Hong Kong is expected to see a Total Capital Raised in the Capital Raising market market reaching US$2.47bn by 2024.
Traditional Capital Raising is set to lead the market with a projected market volume of US$2.42bn in 2024.
When compared globally, the United States is anticipated to generate the most Capital Raised, amounting to US$195,400.0m in 2024.
In Hong Kong's capital raising market, there is a growing trend towards utilizing alternative investment vehicles to attract diverse sources of funding.

Key regions: United States, China, India, Israel, Europe

Market

Region

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Currency

Analyst Opinion

Hong Kong has been a prominent player in the global capital raising market, attracting both domestic and international investors. The city's strategic location, strong financial infrastructure, and investor-friendly regulations have contributed to its position as a major capital raising hub in the Asia-Pacific region.

Customer preferences: Investors in Hong Kong have shown a strong preference for equity capital raising activities, such as initial public offerings (IPOs) and secondary offerings. The Hong Kong Stock Exchange (HKEX) has been a popular venue for companies looking to raise funds through IPOs, with a significant number of listings every year. Investors are attracted to these opportunities as they provide a chance to invest in promising companies and potentially earn significant returns.

Trends in the market: One of the key trends in the capital raising market in Hong Kong is the increasing participation of mainland Chinese companies. Many Chinese companies have chosen to list on the HKEX to gain access to international capital and expand their investor base. This trend has been driven by factors such as the growing Chinese economy, the desire of Chinese companies to enhance their global presence, and the relatively stable regulatory environment in Hong Kong. Another trend in the market is the rise of technology companies seeking capital in Hong Kong. The city has seen a surge in tech IPOs in recent years, with companies from sectors such as e-commerce, fintech, and biotech choosing to list on the HKEX. This trend is driven by the increasing demand for technology-related investments and the recognition of Hong Kong as a hub for tech innovation in the region.

Local special circumstances: Hong Kong's status as a Special Administrative Region of China gives it a unique advantage in attracting capital from both mainland China and international investors. The city's legal system, which is based on English common law, provides a familiar and transparent framework for investors. Additionally, Hong Kong's strong financial infrastructure, including its banking system and stock exchange, further enhances its appeal as a capital raising destination.

Underlying macroeconomic factors: The economic growth and stability of Hong Kong are important factors driving the development of the capital raising market. Hong Kong's strong financial services sector, coupled with its strategic location as a gateway to China and other Asian markets, makes it an attractive destination for companies looking to raise capital. The city's open economy and favorable tax regime also contribute to its appeal. Furthermore, the ongoing economic integration between Hong Kong and mainland China, such as the Greater Bay Area initiative, is expected to further boost capital raising activities in the city. This initiative aims to create a world-class city cluster in the region, promoting collaboration and investment opportunities across different sectors. In conclusion, the capital raising market in Hong Kong is thriving due to customer preferences for equity capital raising, the increasing participation of mainland Chinese companies, the rise of technology companies, local special circumstances, and underlying macroeconomic factors. These factors have contributed to Hong Kong's position as a leading capital raising hub in the Asia-Pacific region.

Methodology

Data coverage:

Data encompasses B2B and B2C enterprises. Figures are based on the amount of capital raised, the average of deal size and the number of deals.

Modeling approach / Market size:

Market sizes are determined through a combined top-down and bottom-up approach, building on a specific rationale for each market segment. As a basis for evaluating markets, we use data from OECD, annual financial reports of key players, industry reports, third-party reports, publicly available databases, and survey results from primary research (e.g., the Statista Global Consumer Survey). In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, CPI, number of small and medium-sized enterprises (SME), new businesses registered (number) . This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the S-curve function and exponential trend smoothing are well suited for forecasting digital products and services due to the non-linear growth of technology adoption.

Additional notes:

The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic and the Russia-Ukraine war is considered at a country-specific level.