A-share market leads the world in terms of IPO volume and fundraising in 2023

Beijing, 2 January 2024 – PwC has today released its review of the performance of the IPO markets in Mainland China and Hong Kong in 2023, as well as their future prospects. The number of A-share IPOs slowed in 2023. There were 313 new listings and RMB356.4 billion in total funds raised, a decrease of 26% and 39% respectively on the previous year.

While A-share IPOs and financing decreased year-on-year, the Shanghai and Shenzhen Stock Exchanges still rank first and second in the world respectively in terms of fundraising. In 2023, 103 IPOs were issued with total fundraising of RMB 193.7 billion on the Shanghai Stock Exchange, while 133 IPOs were issued with total fundraising of RMB 148.1 billion on the Shenzhen Stock Exchange. The Beijing Stock Exchange has entered a period of rapid development, with 77 IPOs and RMB 14.6 billion of fundraising.

Thomas Leung, PwC China Markets Managing partner, said:“With the slowing development of global capital markets, IPO applications on the Shanghai, Shenzhen, and Beijing stock exchanges continue to rise. With the steady promotion of the comprehensive registration system, Chinese capital markets will demonstrate increasing vitality. 2024 is a crucial year for implementing a series of requirements put forward by the Central Financial Work Conference, such as accelerating the construction of a strong financial system and promoting the deepening and implementation of the stock issuance and registration system. PwC predicts 200-240 A-share IPOs for the full year and fundraising of RMB 160-190 billion. Mainland China’s A-share markets will continue to rank first in the world.”

The STAR market and the Shenzhen ChiNext continued to maintain their leading positions in 2023. Shenzhen ChiNext ranked first (110 IPOs) in terms of IPO volume, while the STAR market ranked first (RMB 143.9 billion) in terms of fundraising. The Beijing Stock Exchange has developed rapidly. It has received increasing attention from businesses and may offer a new route into the A-share market for specialist and new growth enterprises. Six of ten largest A-share IPOs in the first half of 2023 were listed on the STAR market.

Charline Ni, PwC China Assurance partner, said: “A safe, transparent, dynamic and resilient capital market is an essential component for building a strong financial system and for promoting economic and social development. The further deepening and implementation of the stock issuance registration system will ensure that financial services serve the real economy. We remain confident about the ongoing development of China's capital markets in 2024. As China's economic development gradually enters a new stage and faces new international and domestic dynamics, regulation will help guide the allocation of capital to major strategic areas. We expect IPOs in 2024 will tend to support areas related to technological innovation, advanced manufacturing, green development, and small and medium-sized enterprises (SMEs). The Beijing Stock Exchange will have a key role to play in supporting the IPOs of SMEs in 2024.”

IPO fundraising continued to slow in Hong Kong in 2023 due to global economic uncertainty and other unfavourable factors. There were 73 IPOs, raising HK$46.3 billion in total – a 19% decrease in volume and a 56% decrease in value year-on-year. The main sectors were retail, consumer goods and services, industrials and materials, as well as healthcare and pharmaceuticals.

The Hong Kong government has introduced a range of policies to promote the growth of the tech industry. Coupled with the new regime for ‘Specialist Technology Companies’ under ’Chapter 18C’, more tech companies will be attracted to list in Hong Kong, thus increasing investor confidence and helping Hong Kong consolidate its status as an international financial centre.

The listing activities of new economy enterprises (including biotechnology and other specialized technology companies) on the Hong Kong Stock Exchange will continue to be active. PwC forecasts that 80 companies will be listed in Hong Kong in 2024, with total funds raised reaching over HK$100 billion, and for Hong Kong to return to the top three global financing markets in 2024.