Connecting SE Asian Firms with Global Capital: HKEX as the Gateway for IPOs in 2025

As Southeast Asian businesses set their sights on overseas expansion, Hong Kong is becoming a pivotal gateway to access global funding to fuel their ambitions. During a breakout session at DealStreetAsia’s Indonesia PE-VC Summit 2025 in Jakarta, sponsored by Hong Kong Exchanges and Clearing Ltd (HKEX), market experts emphasised how Southeast Asian companies can leverage the breadth and depth of Hong Kong’s capital markets, particularly through initial public offerings (IPOs).

Moderated by Eudora Wang, Deputy Editor of Greater China at DealStreetAsia, the session featured insights from Rita Lau, Director, Equity Capital Market, SEA at CLSA; Katherine Ng, Head of Listing at HKEX; and Mandy Wong, Partner at Latham & Watkins.

The IPO Landscape in SE Asia: Challenges and Signs of Recovery

The IPO market in Southeast Asia faced several obstacles in 2024. Political transitions, high interest rates, and geopolitical uncertainties led many businesses to adopt a cautious approach. Rita Lau from CLSA reflected on the difficulties, stating, “2024 was one of the most challenging years in nearly a decade due to high interest rates, geopolitical volatility, and local political factors.” Despite these challenges, she expressed optimism for 2025, citing recovery drivers like easing inflation, strong consumer demand, and rising foreign direct investments.

Malaysia, in particular, has shown continued momentum after achieving a 19-year record high IPO activity in 2024. Regulatory reforms aimed at attracting foreign investors have fostered a more inclusive market. Lau noted, “The Malaysian government’s initiative to reduce the dominance of large domestic investors is creating a more inclusive market environment,” signalling a promising shift for the region.

Hong Kong’s IPO market is also expected to continue on an upward trend in 2025. HKEX Head of Listing Katherine Ng emphasised a strong return of IPO activity in the city in the second half of 2024, (which contributed to over 80% of Hong Kong’s full-year IPO proceeds, according to HKEX data). H2 2024 witnessed Midea Group’s triumphant Hong Kong trading debut, through which the Chinese home appliance maker raised US$4.6 billion in what became Asia’s largest IPO of the year. It is also the second-biggest consumer IPO in HKEX’s history, only topped by Budweiser APAC’s US$5.7 billion IPO in September 2019.

Ng highlighted over 100 applicants currently undergoing the vetting process for a Hong Kong listing, and a growing interest from Southeast Asian companies keen to explore Hong Kong as a listing location.

In fact, Hong Kong is the most popular destination for privately-held Southeast Asian companies looking to go public on a global bourse. Between 2014 and 2023, 83 of the 163 Southeast Asian companies that went public chose HKEX as their listing destination, according to a July 2024 report ‘Unlocking Public Markets: Essential Considerations for SE Asia’s IPO Hopefuls’ published by HKEX and DealStreetAsia.

“We are pleased to see the strong momentum particularly in the second half of last year. As for Southeast Asia companies, J&T Global Express – an international logistics company founded in Indonesia – completed HKEX’s second-biggest IPO of 2023, raising HK$3.9 billion; while Southeast Asian digital solutions platform Synagistics’ listing in October 2024 marked the city’s first ‘de-SPAC’ transaction. On our stock exchange, out of 2,600 companies, over 100 are Southeast Asian companies.”

Future IPO hopefuls from Southeast Asia will find a Hong Kong listing relevant in an evolving regional IPO landscape where consumer, healthcare, technology, and new energy companies are increasingly attractive to global investors.

Deloitte’s “Southeast Asia Mid-Year IPO Snapshot 2024” report highlights that the consumer resources and energy industries were significant contributors to Southeast Asia’s IPO activity in the first half of 2024.

An October 2024 report by Ernst & Young indicates a sustained investor interest globally in AI-driven innovations. Approximately 50 AI companies were in IPO registration at that time, reflecting growing enthusiasm for AI-powered businesses and services.

The shifting IPO dynamics in Southeast Asia and worldwide mean that upcoming IPO champions will find themselves fit right into Hong Kong’s existing listing frameworks, such as Chapter 18A and Chapter 18C, which have made it possible for eligible pre-profit and pre-revenue biotech and Specialist Technology companies to go public.

Under the city’s 18C listing regime, “Specialist Technology” companies refer to companies from five specific industries, namely 1) next-generation information technology; 2) advanced hardware and software; 3) advanced materials; 4) new energy and environmental protection; and 5) new food and agriculture technologies.

HKEX’s years of expertise in hosting issuers across retail, consumer products, healthcare, electric vehicles and new energy, telecoms, technology and AI have nurtured a pool of stock market investors with deep understanding of similar business models. As for biotech, HKEX is already the world’s second-largest biotech fundraising hub.

Hong Kong’s Strategic Position for SE Asian Firms

HKEX, the world-leading global exchange group, sees its success in building a sector-diverse, international market for IPO aspirants as a result of years of careful planning and adaptation.

“It doesn’t happen overnight. It’s not that we have a magic wand and say, you know, I want to focus on Southeast Asian companies, and please come. But over the years, we’ve continued to enhance our market to attract new issuers,” said HKEX’s Katherine Ng.

Recognising the unique characteristics of “new economy” – an evolving concept that describes sectors of an economy that are producing or intensively using innovative technologies, such as biotech and Specialist Technology – HKEX has over the years tailored specific listing regimes to meet their fundraising needs. This approach acknowledges that these companies may not immediately generate profits but possess significant growth potential and require access to capital through public fundraising.

Furthermore, HKEX has demonstrated its adaptability when it introduced modifications in the summer of 2024 to relax certain requirements for the listings of Specialist Technology companies and de-SPAC transactions in response to changing market conditions. This proactive approach to regulatory adjustments highlighted HKEX’s commitment to creating a dynamic and attractive listing environment for companies across various sectors.

“What I think is attractive about Hong Kong is that we are looking at the listing regime all the time. We’re looking at what good companies look like today. And we’re not afraid to modify and take the steps to make it fit for purpose,” said Ng.

Certain groups of Southeast Asian businesses will find a Hong Kong listing particularly attractive, including when entrepreneurs and investors with Chinese backgrounds build from scratch, or expand a venture outside of China. It is not uncommon for Chinese founders to establish operations in a Southeast Asian country like Singapore and later pursue an IPO in Hong Kong as a foreign entity. “That’s one of the companies that we helped with its listing in Hong Kong,” shared Latham & Watkins’ Mandy Wong, highlighting a growing trend of Chinese companies establishing operations in Southeast Asia and subsequently listing in Hong Kong.

“It’s set up by a Chinese founder in Southeast Asia. After a few years of development, Hong Kong became a very obvious choice for them because it’s close to Chinese investors. It’s got a huge international and regional investor space, and the liquidity is good too.”

CLSA’s Rita Lau seconded her view, adding that Southeast Asian companies with a “China angle” will find themselves in a more favourable position to target a Hong Kong listing. “I think for companies to list in Hong Kong, it would be much easier for them to be connected with investors if they have that China angle to start with.”

Moreover, Hong Kong’s Stock Connect programme, which allows eligible Hong Kong-listed companies to access mainland China’s markets, presents a compelling opportunity for Southeast Asian companies. Wong stated, “The regime has also been expanded to cover foreign companies. So even if you are an Indonesia- or Malaysia-incorporated company, as long as you are primarily listed in Hong Kong and become eligible, being one of the constituent stocks of the Hang Seng Composite Index above the minimum market capitalisation requirement, then you will be able to tap into the vast pool of Chinese investors.”

Preparing for a Hong Kong Listing: A Guide for SE Asian Firms

For Southeast Asian companies considering a Hong Kong listing, careful planning and preparation are crucial. “Getting a listing in Hong Kong will take some preparation,” emphasised Wong.

Furthermore, Wong highlighted the importance of adhering to HKEX’s timelines. “For Southeast Asian firms, given time is needed to get familiar with the markets, allow yourself slightly more time on that. And also plan for the entire listing cycle, application cycle, that would also be crucial for a smooth listing process.”

Mirroring the importance of timely execution, Katherine Ng added, “In October of 2024, we introduced a streamlined approval process for new listings, where we are committed to complete an application within 40 business days with no more than two rounds of regulatory review. This will provide issuers more certainty over the IPO review process and allows for more efficient and effective timetable planning.”

Ng also highlighted that an IPO is the first of many steps in the capital-raising cycle. HKEX is committed to assisting companies at every stage of their development, recognising that secondary fundraising plays an essential role in this support.

Responding to market dynamics in 2025, each panellist shared their views on US President Donald Trump’s policies and the potential impact on markets. Ng emphasised the importance of resilience and adaptability.

She stated: “Last time when Donald Trump was President, our markets demonstrated robustness and resiliency. We’re currently doing a lot more strategic partnerships with other stock exchanges, Southeast Asia being an important region that we’re focused on. We’re also doing a lot of work with the Middle East. So yes, uncertainty may continue, but hopefully there will be great opportunities ahead of us,” she concluded.

HKEX added the Indonesia Stock Exchange (IDX) to its list of Recognised Stock Exchanges (RSEs) in 2023, opening the door for companies with a primary listing on IDX’s main market to apply for a secondary listing in Hong Kong. Over the years, it has signed similar arrangements with exchanges including Singapore Exchange, Saudi Exchange, Abu Dhabi Securities Exchange, and Dubai Financial Market. HKEX currently has 19 RSEs, according to the HKEX website.