IPO Boom Fizzles in Hong Kong as Hot Stocks Go Cold
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A three-month rally in Hong Kong’s IPO market appears to be losing steam, after three out of four newly listed companies closed below their offer prices on Thursday.
Among the decliners was autonomous driving startup Pony AI Inc., whose shares sank 12.9% on their first day. Rival WeRide fared even worse, plunging 24.5%, while auto parts supplier Joyson Electronic slipped 1.8%. Only one of the four new listings ended above its IPO price.
Investor sentiment began to shift earlier in the week. On Wednesday, electric-car maker Seres Group Inc. closed flat after recovering from a steep intraday decline of up to 7%. The rebound came in the final 20 minutes of trading. Still, the stock fell a cumulative 13.3% over the next two sessions.
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- Three of four recent Hong Kong IPOs closed below offer prices, including Pony AI (-12.9%) and WeRide (-24.5%), reversing a three-month rally.
- Despite heavy oversubscription (e.g., WeRide 73.4×, Joyson Electronic 147.7×), investor sentiment turned cautious amid market volatility and uncertain profitability.
- First-day IPO returns averaged 37.7% in 2025, but losses at firms like Pony AI ($96.1M H1 2025 loss) and WeRide (792M yuan H1 2025 loss) raised concerns.
- Pony AI Inc.
- Pony AI Inc., an autonomous driving startup, saw its shares plummet 12.9% on its first day of trading in Hong Kong. Despite its retail tranche being 15.9 times oversubscribed, the company reported $35.4 million in revenue but a net loss of $96.1 million in the first half of 2025. Cumulatively, Pony AI incurred over $500 million in losses between 2022 and 2024.
- WeRide
- WeRide (文远知行) is an autonomous driving startup that recently went public in Hong Kong. Its shares plunged 24.5% on their first day of trading. Despite its offering being 73.4 times oversubscribed and raising HK$2.4 billion, the company's losses have mounted, reaching 2.5 billion yuan in 2024 and 792 million yuan in the first half of 2025.
- Joyson Electronic
- Joyson Electronic, an auto parts supplier, recently IPO'd in Hong Kong. Although its retail orders were 147.7 times oversubscribed, its shares slipped 1.8% on its first day of trading. This decline occurred despite strong investor interest in its initial offering.
- Seres Group Inc.
- Seres Group Inc., an electric-car maker, closed flat on Wednesday after recovering from an intraday decline of up to 7%. Despite this rebound, the stock fell a cumulative 13.3% over the next two trading sessions. This performance contributed to a broader cooling of the Hong Kong IPO market, reflecting investor caution and skepticism toward growth companies with uncertain paths to profitability.
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