Earning 10.5 billion in half a year, Hong Kong is keeping its doors open for a longer period.

Laoxiangji is the most tenacious catering company on the Hong Kong stock market. On January 3, 2025, it submitted its listing application to the Stock Exchange of Hong Kong (SEHK) for the first time, which became invalid six months later; it submitted the application again on July 7 the same year, which also expired after six months; it filed the application for the third time on January 8, 2026, and the third application reached its deadline on July 8.

After three rounds, the company's proposal has never been rejected once, but none of them has ever made it to the bell-ringing stage. The intermediary team needs to re-prepare the financial materials and pay the listing application fee again.

Over the past year and a half, such cases have not been rare. Banu, Marubi Biology, Grandpa's Farm... submitting forms, waiting, expiration, and resubmitting, this process has been repeated constantly at the gate of the SEHK, and the six-month period has gradually changed from a technical regulation to a consuming process.

On the afternoon of August 21, the six-month period had expired. The Stock Exchange of Hong Kong Limited, a subsidiary of HKEX, issued a statement that the validity period of qualified new listing applications has been extended from six months to 12 months starting from the date of submission of the listing application form, which takes effect immediately for a period of three years.

Just two days earlier, HKEX had just released its half-year report, which set a new record. Revenue and other gains for the first half of the year amounted to HK$16.702 billion, up 19% year-on-year. Profit attributable to shareholders was HK$10.568 billion, up 24% year-on-year. Both figures are the best half-year results in the group's history, breaking the record set just in the second half of 2025. Trading volumes in the spot market, derivatives market, and Shanghai-Shenzhen-Hong Kong Stock Connect all hit new highs for the second half of this year.

One is the best performance report, and the other is a long-overdue extension notice. These two events are very close. When viewed together, they point to the same problem: what the market lacks the most at present is enthusiasm, not the approval rate.

A Technical Announcement

The announcement issued by the Stock Exchange of Hong Kong has only one sentence, but the supporting clauses can still be checked one by one.

The exemption is short-term in nature. Under the condition of meeting specified conditions and safeguard measures, the validity period of qualified new listing applications is extended to one year from the date of form submission. Applicants still need to comply with all the Listing Rules and provide complete and up-to-date information, including business and financial data. The scope of application includes applications that are valid on the date of the announcement, new submissions or resubmissions after the announcement, new listings of real estate investment trusts, and reverse takeover transactions carried out by listed issuers that are treated as new listings. However, it does not include new listings of real estate investment trusts, nor does it include new submissions or resubmitted applications after the announcement.

Another easily overlooked point is that applicants do not need to file an additional exemption application.

The last item is relatively important. This shows that this is not a special case-by-case approval rule, but a generally applicable rule change with very little resistance during implementation. More than 500 queuing enterprises do not need to do anything, and the validity period of their existing applications will be automatically doubled.

The gate has not been closed. If there is a change of sponsor during the extension period, and the change requires the resubmission of a new listing application in accordance with the regulations, the original application will expire on the day of the change.

To understand this revision, we must first figure out where the six-month figure comes from.

It is not the review time set by HKEX for itself, but the validity period of the documents. The audit report issued by the accounting firm in the prospectus is generally only valid for six months, but the operating conditions of the enterprise will not remain static from the moment the prospectus is submitted. Customer churn, litigation, equity changes, and penalties from regulatory authorities will all occur within these six months. If a listing application can be suspended indefinitely, the materials that investors finally look through will most likely no longer represent the actual situation of the company.

Therefore, what is extended this time is the validity period of the documents, and the substantive requirements for review have not been relaxed — that is, the required updated financial materials still need to be updated, the standards of regulatory authorities and the interests of investors have not changed. Christina WONG, Head of Listing of SEHK, said that this extension is based on the timetable for improving the approval process jointly launched by SEHK and the Securities and Futures Commission (SFC) last October, aiming to provide applicants with more flexibility in managing their listing timetables.

So where has the consumed time gone?

The data released by HKEX itself can also reflect the situation well. In June this year, the average time for SEHK to issue the first comment letter was 15 days, the second comment letter was 20 days, and the hearing document letter was 15 days; from the acceptance of the listing application to the issuance of the hearing document letter, the median time required by SEHK was 36 days. Another set of data shows that in the same process, the median number of business days required by all parties other than SEHK is 64 days, and the total of the two is close to 100 days.

The exchange accounts for one third of it, and the other two thirds are scattered in the domestic filing, intermediary response, and waiting for the issuance window. There is no more room to squeeze out on the review side, and the only thing that can be modified is the timer.

The number of queuing enterprises has been large enough to be taken seriously. As of June 30, SEHK was handling a total of 534 listing applications, and another 25 had been approved by the Listing Committee and were waiting for listing, making a total of 559 enterprises queuing for listing. In the first half of the year, 489 new companies submitted listing applications, of which 127 were A+H. More and more enterprises cannot afford to wait. As of July 24, 10 A-share listed companies have publicly stated that they will give up listing in Hong Kong.

Thus there are examples like Laoxiangji. It submitted applications three times, and each time it expired automatically after six full months, with no formal rejection record from HKEX in public materials. Banu's path is the same. After the failure of its first application, it resubmitted the application ten days later, the second application expired on June 17, 2026, and then it submitted the third one. Marubi Biology submitted its prospectus on December 11 last year, but it expired on June 11 this year. In the week before the expiration, the China Securities Regulatory Commission (CSRC) had just required Marubi to supplement compliance documents related to overseas investment and foreign exchange management.

When all the cases are laid out, most of the bottlenecks lie on the exchange side. After Banu submitted its prospectus for the first time, the CSRC put forward nine requirements for supplementary materials regarding its overseas listing filing, involving the identification of equity structure and actual controller, overseas shareholding procedures, historical equity transfer, data security, pre-listing dividend distribution, labor employment, social security and housing provident fund and other aspects. These problems will not disappear automatically just by giving an extra six months.

It should be noted that expiration upon expiry is not equivalent to being rejected. According to the current standard, enterprises can resubmit applications after updating their financial materials. Resubmitting an application within three months after expiration is generally regarded as an extension of the original application, and all the previous review work will not be invalidated. The extra six months saves repetitive work and successive listing application fees, not any substantive checkpoint.

For companies stuck due to historical evolution or compliance issues, the extension means that the rectification period is prolonged. Those that cannot go public still cannot do so.

Among the HK$16.702 billion revenue, how much does IPO contribute?

HKEX's revenue and other gains for the first half of the year were HK$16.702 billion, up 19% year-on-year. Profit attributable to shareholders was HK$10.568 billion, up 24% year-on-year. Basic earnings per share was HK$8.36. The board of directors announced the distribution of an interim dividend of HK$7.43 per share, also up 24% year-on-year.

Operating expenses increased by 6%, mainly due to the increase in employee salaries, information technology expenditures and charitable donations. If charitable donations, FCA fine expenditures and insurance compensation are excluded, this figure is 9%. The EBITDA margin was 81%, 2 percentage points higher than last year.

The trading side is more active. The average daily turnover of Hong Kong stocks was HK$283 billion, up 18% year-on-year, setting the highest record for the same period in history. The average daily number of traded derivative contracts reached 1.8 million, up 6% year-on-year, also a new historical high.

The Shanghai-Shenzhen-Hong Kong Stock Connect line has the greatest flexibility. The average daily turnover of Shanghai Stock Connect and Shenzhen Stock Connect was RMB 345.3 billion, nearly double that of the same period last year. The average daily turnover of Hong Kong Stock Connect was HK$123.1 billion, up 11% year-on-year. The average daily turnover of Bond Connect Northbound was RMB 47.6 billion, with an increase of only 4%. The average daily trading volume of fee-charging metal contracts on the London Metal Exchange reached 844,000 lots, up 18% year-on-year, also hitting a new high for the same period over the years.

The issuance side is the part that the public cares most about. In the first half of the year, 87 new stocks were listed, raising a total of HK$212.4 billion, up 94% year-on-year. The vigorous issuance activities increased SEHK's listing fee income by 36% to HK$590 million.

HK$590 million. Added to the total revenue of HK$16.702 billion, it accounts for a small proportion, about 3.5%.

This proportion deserves careful consideration. From the perspective of revenue only, new share issuance is almost negligible for HKEX. In the same period, the transaction fee income of equity securities products was HK$3.024 billion, five times that of the listing fee. The real source of income for HKEX is the secondary market transaction and settlement fees, depository fees and other fees calculated based on the transaction amount.

In that case, why does HKEX keep revising the rules, issuing exemption orders, and opening green channels. The explanation given by Agnes CHAN at the performance meeting is very simple: every new share issuance will bring new investors into the market, or make existing investors increase their proportion of investment in Hong Kong stocks, which will drive the liquidity of the secondary market. IPO itself is not profitable, but the new targets, new funds and new trading volume brought by IPO are the sources of profit. Tracing back along this logic, the announcement on August 21 that only involves application fees and document validity period actually affects the entry end of the HK$16.7 billion revenue.

We cannot attribute all the credit to the system.

The return of new share subscription in the first half of the year has improved, mainly for two reasons: First, the new IPO pricing and allocation regulations introduced in August 2025 have been fully implemented this year, issuers, underwriters and various institutional investors have adapted to the new rules, and quotations have become more reasonable. Second, hard technology companies have become the main supply side, and such targets have high attention, and the market has a high tolerance for their valuations.

But the bigger variable is the market itself. A set of longitudinal comparisons mentioned by Agnes CHAN is more direct than anything else: the average daily trading volume in the first half of this year reached HK$280 billion, while it was around HK$250 billion in the same period last year, and only HK$130 billion the year before last. It has more than doubled in two years, and such a growth rate cannot be explained by any revision of listing rules.

System reform is a necessary condition, not a sufficient condition. The re-pricing of Chinese assets, the spread of artificial intelligence stories all over the world, and the continuous inflow of southbound funds are all moving in one direction.

There is still an unsolved test paper in the second half of the year. According to estimates, the market value to be unlocked in the Hong Kong stock market in 2026 will reach a record high of HK$1.6 trillion to HK$1.7 trillion. Among them, the unlock volume in September is expected to be about HK$530 billion, and the large-scale unlock of Zijin Gold International Holdings accounts for most of the month. After the lock-up period ends, the fundamentals of listed companies will face a real test.

Two days before the release of the half-year report, HKEX announced that the term of Agnes CHAN as Chief Executive Officer has been extended for three years to 2030. Her keyword for the future is a multi-asset ecosystem, including fixed income, currencies, commodities, indices and data that will all be placed on the trading shelf. The liquidity of the secondary market and the activity of the IPO market have almost recovered, and the next growth engine needs to find a new source.

Those queuing, those going public

The two most resounding gongs and drums on the Hong Kong stock market this year were one day apart.

On January 8, Zhipu AI was listed on The Stock Exchange of Hong Kong Limited, becoming the first stock of the global large model sector. On the listing day, its share price rose by more than 13%, and the total market value reached HK$57.9 billion. The next day was MiniMax, a large model company that took only a few months from its establishment to listing. On the first day of listing, its share price soared by nearly 110%, and its market value also exceeded the HK$1.05 trillion mark.

The dramatic part happened afterwards. On February 20, the first trading day of the Year of the Horse, the market values of the two companies both exceeded the HK$300 billion mark. Zhipu AI surged by 42.72% that day, closing at HK$725, with a cumulative increase of 206% since February. On March 18, MiniMax's intraday price rose to a maximum of HK$1,330, with a total market value of HK$388.281 billion, once exceeding Baidu.

The semiconductor and computing power sectors are both dense with outstanding companies. GigaDevice, Montage Technology, Iluvatar CoreX, Primisium, Biren Tech and other companies have been listed one after another. Montage Technology raised HK$81 billion, and Primisium's first-day listing increase reached 383.62%, ranking first in the whole year, followed by Haiqing Zhiyuan and Deep Intelligence, with increases of 270.83% and 265.77% respectively.

In April, Shenghong Technology was successfully listed on HKEX, raising HK$23.1 billion. Muyuan Foods raised HK$12.1 billion, Dongpeng Beverage raised HK$11.1 billion, Huaqin Technology raised more than HK$4 billion, and Sige New Energy also raised more than HK$4 billion. In the biomedical sector, Mestron Therapeutics was listed on May 13, with institutions such as BlackRock and UBS appearing in the cornerstone investor list.

Structural data is more convincing than individual cases. The top 10 IPOs in the first half of the year raised a total of HK$92.2 billion, accounting for 44% of the total market financing, of which 8 chose A+H dual listing, and the other 2 were pure Hong Kong stock initial offerings. From the full-caliber perspective, in the first half of the year, 24 A-share companies completed H-share listing, raising a total of HK$121.7 billion, accounting for 58% of the total IPO financing.

Hong Kong is becoming the second listing place for leading mainland enterprises, not only new economy companies can be listed in Hong Kong.

The new share subscription experience has also returned. According to statistics from EY, the average first-day return of Hong Kong new shares in the first half of the year was 61%, and Deloitte's data was 52%. The break-even rate has dropped to the lowest level in nearly five years. However, the popularity is not evenly distributed. In the first five months, 19 companies recorded cumulative declines, and the share prices of some of them even fell by more than 50%.

Funds are mainly invested in targets with clear industrial trends and scarce technologies, and are relatively cautious about new shares in the consumer, traditional manufacturing and sectors with weak growth logic. The most interesting point when putting these two sets of data together is: Zhipu AI rose by 13.17% on the first day, and the cumulative increase reached 1272.6% by the end of May; Primisium rose by 383.62% on the first day, but fell by 24.32% in the single month of May. The performance on the first day represents the short-term supply-demand relationship and market sentiment, while the performance in the following days tests the industrial status of the enterprise.

Another