Investing.com — Chinese artificial intelligence supply-chain companies are expected to continue pursuing Hong Kong listings despite growing valuation concerns and increased investor scrutiny, according to Citigroup.
Simon Yuan, Citi’s head of China investment banking, said demand for Chinese AI-related listings remains resilient despite recent valuation pullbacks affecting data centre companies, particularly in the U.S.
Speaking on the sidelines of the International Monetary Fund’s annual meetings in Bangkok, Yuan said Hong Kong’s IPO market benefits from a relatively balanced mix of domestic Chinese and international investors.
Growing southbound investment flows from mainland China have also strengthened the market’s liquidity, providing support for companies seeking to raise capital.
However, Yuan warned that Hong Kong would not be immune to a broader correction in global AI valuations.
He said a significant downturn in the U.S. AI investment cycle could affect markets worldwide, including Hong Kong, following increased volatility in recent weeks.
Chinese hardware manufacturers have benefited from rising global demand for AI infrastructure, recording higher sales volumes alongside stronger unit prices.
Many companies have also established manufacturing operations outside mainland China, allowing them to serve international customers while reducing exposure to geopolitical tensions.
Looking ahead, Yuan expects Hong Kong’s equity capital markets to shift their focus next year from AI hardware suppliers towards Chinese AI model developers and application companies.
However, he cautioned that prospective issuers would need to demonstrate sustainable business models, strong revenue growth and profitability to attract investors.
The outlook comes amid a strong year for Hong Kong’s IPO market, supported by Chinese technology companies seeking fresh capital.
A total of 118 companies were listed in Hong Kong during the first nine months of 2026, raising HK 388 billion (49.4 billion), representing a 106% increase from the corresponding period last year.
The figures highlight continued investor appetite for Chinese technology listings, even as concerns over elevated AI valuations create uncertainty across global equity markets.
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