A summer sprint in Hong Kong
Summer break? Not this year. Hong Kong bankers stayed on the field as AI-fueled capital raises set a third-quarter record, with $47.5 billion coming from IPOs, placements and block trades. The surge has pushed total proceeds so far this year past $92 billion, close to the all-time high of $112.5 billion set in 2021. Rising bond yields and choppy deal outcomes, though, are making both issuers and investors a bit more guarded.
AI is the spark, and the checks are big
Artificial intelligence didn't just nudge the market back to life - it hit fast forward. Chinese companies are tapping larger checks and returning to the market sooner to bankroll growth in the fast-growing sector.
The headline print: Alibaba Group Holding Ltd. raised $10.2 billion in a follow-on, the period's largest deal. Zhongji Innolight Co. hauled in almost $8 billion in Hong Kong's biggest listing in nearly seven years. And AI model developer Z.AI Co. amassed $9.6 billion this year via its IPO, subsequent share sales, and convertible bond issues.
Others wasted no time after lockups expired. In a feverish July, model maker MiniMax Group Inc. plus chipmakers Shanghai Iluvatar CoreX Semiconductor Co. and Shanghai Biren Technology Co. returned to the market soon after their IPO lockups ended.
Capital raising tells you where the smart money thinks the next cycle is heading. Market Briefs tracks the deal flow free every morning.
The region widens the lead, India roars back
Momentum extended across Asia-Pacific, with equity issuance surpassing $120 billion during the third quarter, marking the region's strongest third-quarter in six years. Some of the heftiest deals came out of Mainland China, highlighted by a 66.6 billion yuan ($9.9 billion) IPO by memory chipmaker CXMT Corp., the country's second-largest on record.
India snapped back too. Since July, equity offerings there raised a record $26 billion, marking the country's strongest quarter. Highlights included a $3.2 billion government stake sale in Life Insurance Corp., plus the much-anticipated $2.4 billion IPO of National Stock Exchange of India Ltd., which ranks as the country's second-largest on record.
Heat meets headwinds as year-end nears
All this fundraising arrived against a shakier market tape. The MSCI Asia-Pacific Index dropped by as much as 7% in July, and Hong Kong's Hang Seng Tech Index has been trending lower this year. Deal quality is under the microscope: of the 10 largest Hong Kong offerings since the start of July, only two are trading above water. "So as we go into year-end, I would expect that investors potentially become more selective about where they put their money to work."
Even so, the pipeline is substantial. The Philippines is set for a milestone: Mynt Inc., owner of the GCash app, has priced what's poised to be the country's largest-ever IPO. Australia is set to partake in the AI wave too, with a forthcoming $5 billion IPO by data center operator Firmus Grid Ltd., expected to be among the country's largest listings ever. And as Goldman's Wang put it: "Investors will be more selective.
What this could mean for your money
More deals are coming, even as markets wobble. That means plenty of choice, but also wider spreads in outcomes as investors zero in on quality and steer clear of anything that can't clear the bar on growth, profitability or both. Watch the mix: AI-linked names are fueling supply, while rate jitters and soft first-day pops are testing demand. How those two forces settle will shape where fresh capital actually sticks.
A record quarter in Asia says the AI trade is far from a US-only story. Get the free Market Briefs daily newsletter and follow the money.
