For China’s hi-tech IPOs, it’s Hong Kong vs the mainland – but how much does it matter?

For China's tech IPOs, the choice between Hong Kong and mainland China is not a zero-sum game but a strategic one, according to a Beijing executive representing a cross-border innovation platform. General Manager Lu Peng of Zhongguancun International explained that while competition exists, the differing goals and investor bases of firms dictate the final decision.

Companies aiming for global expansion typically opt for Hong Kong, while those seeking higher valuation multiples often remain domestic, where growth stocks fetch richer price-to-earnings ratios.

This divide has deepened as Beijing relaxed regulations, facilitating Hong Kong listings for mainland firms since 2024. Beijing-based firms comprised 8.72% of all A-share listings as of August 31, with a combined market value of 23.74 trillion yuan – the largest share of any region in China. Regardless of their starting point, tech companies generally aim to become "global giants," leading many to pursue listings on both venues over time.

This dual-track approach aligns with China's broader economic strategy, promoting domestic growth while integrating with foreign trade and international capital.

Lu Peng will lead a delegation of five AI companies to Hong Kong's FinTech Week x StartmeupHK in November, including Yuequan Bionics, a humanoid-robotics developer likely to lead the pack for a Hong Kong IPO. Other attendees are expected to be Zhongguancun Kejin, a large-language-model firm, and PanaPay, a cross-border payments platform targeting emerging markets.

Hong Kong's allure lies in three roles: a gateway, a connector, and a hub. Lu explained that Hong Kong offers direct access to international capital and distribution channels, validation for products entering Western markets, and serves as a hub for integration with global trade.