DeepSeek ignites IPOs! The number of IPOs in Hong Kong in the first quarter reached 15, with the financing scale hitting a new high since 2021

Since the launch of DeepSeek at the end of January, global investors have begun to return to the Hong Kong market, with a significant rebound in IPO activity in the first quarter. Among them, Chinese companies seized the window for listing in Hong Kong, with 15 IPOs raising HKD 17.7 billion, marking the best start since 2021. "All parties are cooperating so perfectly. IPO candidate companies, investors, and regulatory agencies," said George Chan, global IPO leader at Ernst & Young, "these three parties are currently collaborating seamlessly, nurturing a healthy IPO market in Hong Kong." "Long-term funds from the U.S. have returned, indicating that investor confidence in China is strengthening, and the post-IPO performance is also encouraging." Surge in Hong Kong IPOs, substantial financing scale In January this year, with the launch of DeepSeek, its reasoning capabilities rival those of OpenAI's ChatGPT, and at a lower cost. This news severely impacted global tech stocks at the end of January while stimulating a rise in the Chinese stock market. The Hong Kong Hang Seng Index soared to its highest point in three years. According to data from KPMG, in the first quarter, there were 6 IPOs in Hong Kong with financing amounts exceeding HKD 1 billion (approximately USD 130 million), compared to only 1 such case in the same period last year. KPMG stated, there were a total of 15 IPOs in Hong Kong in the first quarter, with a total financing amount of HKD 17.7 billion, the best annual start since 2021. In the first quarter of 2021, there were 32 IPOs in Hong Kong, raising as much as HKD 132.7 billion. The Hong Kong Stock Exchange has adjusted its listing rules, including support for companies already listed in mainland China to issue stocks in Hong Kong. According to Tiger Brokers, some companies listed in mainland China, such as Heng Rui Medicine, Maiwei Biotechnology, Haitian Flavoring & Food, Panlin Semiconductor, and Sanhua Intelligent Control, are also "actively seeking to list in Hong Kong." "Chinese regulatory agencies are encouraging companies to list in Hong Kong to broaden financing channels and support the overseas acquisition needs of Chinese enterprises," the company stated. Chan from Ernst & Young said: “There is often a pattern; if the situation can last for three to four months, it is likely to continue for the remainder of the year.”