Research reviewed 29 July 2026
Hong Kong entered 2026 with renewed equity-market activity and a large listing pipeline. For valuation work, the important point is not simply deal volume: faster transactions and more varied applicants increase the need for well-supported forecasts, security-right analysis, comparable selection and disclosure-ready documentation.
1. Capital-market momentum
HKEX reported that Hong Kong was the world’s top IPO fundraising venue in 2025, raising HK$286.9 billion from 119 IPOs. In Q1 2026, IPO funds raised reached HK$110.4 billion, compared with HK$18.7 billion in Q1 2025.
This backdrop can increase valuation demand across pre-IPO equity instruments, business combinations, employee incentives, cornerstone or strategic investments, transaction pricing and ongoing financial reporting.
2. Listing reforms effective 24 July 2026
HKEX adopted reforms to enhance listing competitiveness with immediate effect. Among the changes, the market capitalisation tests for weighted voting rights applicants were lowered to HK$20 billion, or HK$6 billion with at least HK$600 million of revenue for the most recent audited financial year. The non-public filing option was also extended to all new applicants.
Valuation teams supporting innovative, specialist technology, biotech or overseas issuers should coordinate closely with sponsors, reporting accountants and legal advisers. Rights, business model novelty, external investment evidence and financial forecasts may all affect the wider listing narrative.
3. Business valuation and transaction disclosure
HKEX guidance GL116-23 focuses on disclosure of the basis of consideration and business valuations in notifiable transactions. A valuation used in transaction pricing should therefore be capable of supporting clear explanations of methodology, assumptions, comparable selection, forecasts and the board’s assessment.
A transaction timetable should reserve time not only for modelling, but also for announcement drafting, management verification and professional-party review.
4. Standards environment
HKFRS 13 provides the fair value measurement framework for financial reporting. HKAS 36 remains central to impairment testing. For property, HKEX rules refer to HKIS valuation standards or internationally recognised standards in relevant circumstances. The current edition of International Valuation Standards became effective for valuations performed on or after 31 January 2025, and HKIS lists its Valuation Standards 2024 as the current local edition.
For funds, SFC materials emphasise appropriate valuation methodologies, consistent application and controls around conflicts of interest. For employee benefits, Hong Kong’s abolition of MPF offsetting took effect on 1 May 2025, creating a continuing need for accurate employee data and actuarial measurement of long service payment obligations.
5. Practical implications
- Scope early. Identify valuation subjects and reporting requirements before transaction or audit deadlines become fixed.
- Own the forecast. Management should be able to explain operational drivers, downside cases and funding needs.
- Map rights. Preference shares, convertibles, earn-outs and employee options can change value allocation materially.
- Document sources. Market data, comparable exclusions and unobservable inputs should be traceable.
- Plan review. Auditor, sponsor, board, regulator and counterparty questions may focus on different risks.
Official sources
- HKEX Annual Report 2025
- HKEX Q1 2026 Hong Kong Market Update
- HKEX consultation conclusions on listing competitiveness, 24 July 2026
- HKEX GL116-23
- HKFRS 13 Fair Value Measurement
- SFC Fund Manager Code of Conduct
- IVSC: current IVS effective 31 January 2025
- HKIS Valuation Standards page
- Labour Department: abolition of MPF offsetting FAQ