Market AnalysisJun 27, 20262 Min

Hong Kong IPO Revival Drives Record $152 Billion Through Southbound Stock Connect

Purchases of Hong Kong-listed shares by mainland Chinese investors via Southbound Stock Connect climbed to an all-time high in the past 12 months, driven by renewed confidence in the market amid a surge in upcoming stock market listings.

Buying activity from mainland investors reached HK$1.19 trillion (US$151.8 billion) over the 12 months to March, the Securities and Futures Commission (SFC) said in its annual report published on Wednesday.

Hong Kong’s Role As The Ultimate Financial Gateway

The report showed that average daily southbound inflows climbed 84% year-on-year to HK$124.1 billion, increasing its share of the city's overall trading activity to 24% from 20% a year earlier. In the same period, northbound trading made up 6.3% of mainland market turnover.

“Global capital flows will continue to be influenced by macroeconomic uncertainty, geopolitical shifts, rapid technological advances including digital finance and artificial intelligence, and the transition to a more sustainable economy,” said SFC chairman Kelvin Wong Tin-yau in a statement, reported South China Morning Post.

“Amid emerging challenges, the SFC will stay focused on its strategic priorities to entrench Hong Kong’s irreplaceable position as the vital financial gateway bridging the mainland and the world,” he added.

Since its debut in 2014, the Stock Connect programme has facilitated cumulative southbound flows of HK$5.3 trillion and northbound flows of 1.47 trillion yuan (US$216.8 billion).

What Is Leading To The Sudden Boost?

“Initiatives launched over the past year to improve sponsors’ quality, narrow bid-ask spreads,, and lower collateral costs are already delivering impact,” said SFC CEO Julia Leung Fung-yee, according to China Daily Hong Kong.

“Deeper connectivity is fundamental to the stable development of both mainland and Hong Kong markets,” Leung added.

Average daily turnover across stocks and ETFs through the northbound link rose 32.1% month-on-month in May to 395.27 billion yuan. Southbound activity also strengthened, with turnover climbing 23.9% to HK$133.67 billion.

“In the past few years, supported by government policy, many high-quality mainland companies have come to Hong Kong to list, such as CATL and Zhipu. This group of quality firms attracts global capital,” said Mike Leung Kit-man, a director at Wocom Securities, as reported by South China Morning Post.

Chinese Companies Tap Hong Kong for IPOs: What It Means For Investors

Data from LSEG Data & Analytics showed that 59 companies went public in Hong Kong between January and May, collectively raising US$20.42 billion. The strong showing follows a robust 2025, when 114 listings generated US$37.22 billion and reinforced the city's status as a top global destination for IPOs.

The report pointed to growing investor appetite for innovative financial products. Average daily turnover in ETFs and leveraged and inverse products reached HK$38.1 billion, up 50.6% year-on-year, while tokenised products recorded a near six-fold increase to HK$10.8 billion.

“The current Hong Kong IPO resurgence is not a simple cyclical rebound,” said William Chow, deputy group CEO of Hong Kong-based Raffles Family Office. “It represents a new market regime shaped by mainland China capital flows, southbound liquidity and A+H dual listings.”