Growth in China’s tech stocks just getting started, JPMorgan banker says

The recovery of China’s tech stocks from their trough is still at an early stage, as the country’s emergence as an artificial intelligence superpower reshapes global platforms and lures Western capital back, according to a senior investment banker at JPMorgan.\nAs Chinese entrepreneurs expanded their businesses globally and deepened their involvement in AI, their companies and fundraising plans were once again drawing the attention of international investors after years of stagnation, said Mark Fiteny, the US bank’s head of Asia-Pacific technology, media and telecommunications (TMT) and new economy.\n“Investors hold a lean-forward sentiment because they are underexposed in their portfolios to these AI trends in China,” Fiteny said in an interview ahead of the firm’s annual TMT conference in Asia, which concludes in Hong Kong on Tuesday.\nGlobal investors have started reallocating funds to some of China’s largest and most liquid names as the world’s second-largest economy has benefited from recent policy stimulus and technology breakthroughs. Yet, these allocations remained below those of 2015 through 2021, Fiteny said, after investors cut back amid geopolitical and macro risks as well as China’s domestic economic challenges.\n“The recovery of China tech stocks from their trough is still at an earlier stage than the rise of the Nasdaq,” he said, pointing to the lower price-to-earnings multiples of Chinese tech companies compared with those of US peers that have similar growth rates and profitability. “There’s still a delta built into where things are trading, but it has been converging.”\nUS investment firms running global funds were showing an increasing appetite for Chinese equities, said Fiteny, who also serves as JPMorgan’s head of global consumer internet investment banking. “Hong Kong-listed stocks and the upcoming [listing] pipeline offer diversification from their Western holdings with a broad mix of growth drivers.”\nMany investors from the Middle East, Southeast Asia and Europe were also focused on gaining China exposure, offering well-balanced funding sources for Chinese tech firms, he added.\n“The Middle East provides long-term, permanent capital seeking exposure to China’s digital economy,” Fiteny said. “Europe serves as a safe haven with fewer native AI companies, prompting European investors to focus on China exposure.”\nChinese issuers welcomed this attention from European investors because it helped “balance their capital tables” and reduced “dependence on more fluctuating, sensitive, US-based funds”, he said.\nAmid the increasing investor appetite, Chinese companies and their advisers are getting ready for a busy 2026, riding on this year’s tailwind.\n“China is the largest driver of Asia’s capital markets, with considerable growth ahead, mainly from tech companies and equities in Hong Kong,” Fiteny said.\nThe backlog of Chinese companies focused on Hong Kong initial public offerings (IPOs) was “as robust as we’ve seen in a long time”, he added. These companies were from sectors across the board, including the internet, software, foundational AI, robotics and the tech supply chain, he added.\n\nHong Kong IPOs raised HK$216 billion (US$27.8 billion) in the first 10 months of this year, more than three times the level a year earlier, according to data from the Hong Kong stock exchange.\n“Chinese entrepreneurs are increasingly building global businesses rather than focusing solely on the domestic market, which is driving their strategic and financing road map,” Fiteny said. “Many companies aim to access institutional and sovereign wealth capital and often go public earlier than Western peers to gain greater flexibility and access in raising funds.”\nThe fundamental trends driving technology transformation were “strong and compelling”, and would deliver “sustainable value” to the markets, he added.\n“The US and China are the two core drivers of innovation in AI, each with its unique angles, but together they anchor the intellectual capital and financing where companies are being born and scaling up,” he said.\n