Asia’s equity capital markets are entering a phase that only a year ago seemed out of reach: after a prolonged period of caution, the region has re-emerged as a global magnet for liquidity. The resurgence of major IPOs from China and India, combined with investors’ desire to diversify amid growing uncertainty in the United States, is reshaping market flows across the continent. At YourDailyAnalysis, we see this not merely as a cyclical rebound but as the early stages of a deeper capital rotation that is positioning Asia as a natural destination for companies seeking higher valuations and resilient demand.
According to LSEG data, Asia’s ECM activity – spanning IPOs, follow-on offerings and convertible bonds – has reached $267 billion in 2025, a 15% increase from last year and the first annual gain since 2021. Hong Kong stands at the center of this revival, with roughly $75 billion raised – triple last year’s tally and the strongest result in four years. India, though recording a slight dip from its record 2024 performance, still generated $19.3 billion in IPO proceeds and is projected by Equirus Capital to approach $20 billion in 2026. From our perspective, these numbers signal the emergence of two dominant anchors in the region – China and India – likely to shape capital flows well into the next cycle.
The pipeline reinforces this shift. Hong Kong has logged more than 300 listing applications, while India is preparing for landmark offerings such as Reliance Jio Platforms. In parallel, Zhongji Innolight’s secondary listing could significantly expand the liquidity base for Chinese issuers. At YourDailyAnalysis, we view 2026 as a high-probability window for many of these companies, particularly as global investors recalibrate their portfolios toward markets with clearer earnings momentum and stronger demographic tailwinds.
One of the main accelerants has been the retreat from U.S. equities. With political and trade uncertainties surrounding the Trump administration unsettling American markets, investors are increasingly seeking diversification in economies with structural growth. Asian benchmarks have responded accordingly: the Hang Seng Index has climbed nearly 30% this year, while India’s Nifty has gained more than 10%, signalling renewed confidence in regional corporate earnings.
This backdrop helped fuel some of 2025’s most notable deals. CATL raised $5.3 billion through its secondary Hong Kong listing, while Zijin Gold secured $3.5 billion in one of the year’s largest global IPOs. To us at YourDailyAnalysis, these transactions illustrate a broader shift in global capital – from overvalued Western megacaps toward tangible, income-generating assets tied to the real economy.
Yet beneath the optimism lies a growing source of tension: questions over whether the rapid rise in AI-related valuations is sustainable. Sharp volatility in U.S. equities in November exposed early cracks in the global AI rally. With Chinese players such as Zhipu AI, MiniMax, MetaX and Kunlunxin preparing billion-dollar listings, concerns about inflated pricing have become more pronounced. Legal advisers and bankers warn that a material correction in AI could spill over into the broader ECM ecosystem. At YourDailyAnalysis, we share this caution: an AI-driven repricing would not remain confined to one sector and could reshape investor appetite across Asia.
India, ironically, may benefit from this uncertainty. Its market remains relatively undervalued in AI terms, and advisers expect risk-averse investors to tilt toward companies with stable cash flows rather than high-growth narratives. This aligns with a global rotation back toward fundamentals – a trend we interpret at YourDailyAnalysis as a sign of maturing capital discipline rather than risk-off behavior.
Taken together, Asia enters 2026 with both exceptional momentum and equally notable pressure points. If China’s recovery holds and India continues its expansion, the region could become the world’s leading hub for equity issuance. But sustainability will depend on two variables: whether technology companies can justify their valuations, and whether investors can differentiate genuine earnings strength from inflated growth projections. At Your Daily Analysis, we believe the coming year will serve as a stress test for Asia’s capital markets – and that the clear winners will be issuers with profitability, transparency and credible global ambitions.
