The Hong Kong Special Administrative Region’s equity capital markets are seeing the most action in years, with multibillion dollar deals lifting the mood and fueling anticipation about more deals to come.

“I don’t think we have seen this kind of excitement for Hong Kong and China for a long time,” said Cathy Zhang, head of Asia-Pacific equity capital markets at Morgan Stanley.

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Initial public offerings and additional share sales in the SAR have fetched $26.5 billion so far in 2025, compared with just $3.8 billion a year ago and the most since 2021, which was a record year, data compiled by Bloomberg show.

Three $5 billion-plus share offerings by Chinese mainland giants have driven the boom. The most recent was battery maker Contemporary Amperex Technology Co Ltd’s listing, the biggest worldwide this year. That was preceded by Xiaomi Corp and BYD Co selling over $11 billion worth of new stock combined in March.

If fast-fashion giant Shein Group Ltd goes ahead with an IPO in Hong Kong instead of London, it would be yet another high-profile deal for the city.

Despite global unrest and trade war threats, investors are clamoring for a piece as valuations are still attractive.

“There’s a broader global rebalancing underway, not just in trade flows, but in capital allocation,” said James Wang, head of Asia ex-Japan equity capital markets at Goldman Sachs Group Inc. “Incrementally, we’re seeing capital flow out of the US and into select emerging markets, including India and Hong Kong.”

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A large chunk of Hong Kong’s pipeline consists of mainland-traded firms looking to sell shares in the SAR, encouraged by regulatory support for such deals.

CATL is rare in that it is trading at a premium to its shares in Shenzhen, having risen about 18 percent since its Hong Kong introduction in May. Jiangsu Hengrui Pharmaceuticals Co, which raised $1.3 billion in a Hong Kong listing last month, also briefly rose above its A-shares in Shanghai on its debut. 

This could further encourage mainland-traded companies to consider listings in the SAR.

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“The CATL listing is setting positive momentum for the Hong Kong market and we would advise our clients that now is a good time to go ahead with their capital market plans,” said Shi Qi, China International Capital Corp’s deputy head of capital markets.

Still, a note of caution: It won’t be a “straightforward market rally,” she said.