A Feast of New Stocks: Hong Kong IPO Market Hits Its Annual Peak

As August 2026 begins, the listing department staff at the Hong Kong Stock Exchange may be experiencing their busiest period of the year. According to data from multiple GP financial terminals, in just the first week of August, 12 companies passed the HKEX hearing and plan to complete their listing within the month, a figure that marks the highest single-month total since 2024. From AI large-model applications to new energy battery recycling, from biomedicine to cross-border payments, the industry distribution of this batch of new stocks is extremely broad, with most carrying a distinct "new quality productive forces" label.

This wave of new stocks, dubbed "Super August," is no accident. Looking back at the first half of 2026, while the number of newly listed companies on the HKEX grew slightly year-on-year, the scale of fundraising remained tepid. Entering the second half of the year, as global capital reassesses Chinese tech assets and the HKEX's 18C listing rules continue to gain traction, the path for specialist technology companies to list in Hong Kong has been cleared, directly igniting pent-up listing demand. For mainland investors, this is not only a feast for IPO subscriptions but also an opportunity to deeply understand the core proposition of "why choose Hong Kong stocks."

18C Rules Take Effect: A "Fast Track" for Hard-Tech Companies

Why are more and more future-oriented tech companies abandoning U.S. listings in favor of Hong Kong? The answer largely lies in the HKEX's 18C listing rules. These rules specifically target five major specialist technology industries—next-generation information technology, advanced hardware, advanced materials, new energy, and energy conservation and environmental protection—significantly relaxing revenue thresholds and listing requirements. Among the August IPO candidates, over half are direct beneficiaries of the 18C rules. For example, "Zhiyuan Technology," focused on industrial-grade embodied intelligent robots, and "Weilan New Energy," engaged in solid-state battery R&D, are both in the early stages of commercialization and have yet to achieve large-scale profitability. However, thanks to the HKEX's flexible handling of the "market cap/revenue ratio," they can access capital market financing during the critical R&D investment phase.

This institutional advantage is something the A-share market cannot fully replicate in the short term. Although the STAR Market also supports hard tech, it still imposes certain rigid requirements on the definition of "hard technology" and profitability metrics. The HKEX's 18C rules are closer to the prevailing standards of international capital markets, allowing unprofitable, high-R&D-investment enterprises to list, directly addressing the pain point of hard-tech companies that "burn cash on R&D and urgently need financing." For investors, this means the opportunity to share in the growth dividends of cutting-edge tech companies at an earlier stage, rather than waiting until the company matures to buy in.

Southbound Funds' "IPO Fever": Why Mainland Investors Favor Hong Kong New Stocks

Beyond the choices of listing companies, the enthusiastic participation of mainland investors is also a major driver of this new stock frenzy. According to data from the Shanghai and Shenzhen stock exchanges, in July 2026, net southbound fund inflows exceeded HK$120 billion, hitting a new high for the year. Notably, this batch of southbound capital is no longer solely focused on established internet stocks like Tencent and Meituan but is increasingly participating in grey market trading and first-day trading of new stocks through the Stock Connect.

Why are mainland investors becoming so keen on Hong Kong IPOs? Compared to the A-share market, Hong Kong IPOs offer several distinct advantages: First, the allocation rate is relatively higher. Although popular new stocks are still highly competitive, Hong Kong tends to favor a "one person, one lot" inclusive allocation system, giving retail investors a better experience compared to the extremely low allocation rates of a few ten-thousandths in A-shares. Second, Hong Kong new stocks have no price fluctuation limits, often fully releasing positive news on the first day of listing, with some even doubling in a single day, which is highly attractive to capital seeking short-term explosive returns. Third, the Hong Kong market allows grey market trading, enabling investors to arbitrage their allocated new shares the day before the official listing, increasing capital efficiency.

Valuation Trough Meets Policy Dividends: Hong Kong Market Becoming "China's Nasdaq"

Returning to the fundamental question of "Why choose Hong Kong stocks," the activity in new stocks is just the tip of the iceberg. From a broader perspective, the Hong Kong market is undergoing a deep "metabolism" and "valuation reshaping." The Hang Seng Index currently trades at a price-to-earnings ratio of about 10 times, compared to nearly 30 times for the Nasdaq, still representing a valuation trough among major global markets. As more high-tech, high-growth companies list in Hong Kong, the weighting of tech stocks in the Hang Seng Index is rapidly increasing, while the weighting of traditional financial and property sectors is shrinking.

Meanwhile, the expansion of the RMB counter trading and the continuous enrichment of Hong Kong Stock Connect eligible stocks have significantly lowered the threshold and exchange rate risk for mainland residents to allocate Hong Kong stocks. Against the backdrop of the A-share market recently constrained by macroeconomic expectation fluctuations and lacking systemic opportunities, Hong Kong stocks, with their international investor structure, flexible listing regime, and low valuation appeal, are becoming the preferred destination for mainland investors' diversified asset allocation. This wave of new stocks in August provides investors with an excellent window to observe the vitality and institutional competitiveness of the Hong Kong market.

For ordinary investors, facing such a dense schedule of new stock issuances, one should neither blindly "subscribe to all" nor completely avoid them. It is recommended that investors focus on targets with core technological barriers and backing from industrial capital or well-known cornerstone investors in their shareholder background. At the same time, leveraging the quota advantages of the Hong Kong Stock Connect to capture leading hard-tech sectors that are scarce in A-shares may be a key strategy for achieving excess returns in the second half of 2026.