Capital market revival fuels consumer sector growth in China

Four of the top ten HKEX IPOs in H1 2025 were consumer companies.

China’s economic revival is being mirrored in a resurgence of its capital markets, with fundraising on the Hong Kong Stock Exchange (HKEX) surging in the first half of 2025, according to a report by McKinsey & Co.

Companies raised $13.7b (HKD107.1b) in H1, a dramatic jump from just $1.66b (HKD13b) in the same period last year. Meanwhile, Mainland China saw 51 initial public offerings (IPOs) raise (RMB37.3b), signalling robust activity despite not yet reaching the peaks of 2021–2022.

Consumer companies have emerged as a driving force behind this rebound, reflecting investor confidence in China’s medium- and long-term consumption prospects.

Four of the top ten IPOs on HKEX by funds raised in H1 2025 were consumer-focused. Leading the pack were two Mainland retail brands: Mixue and Guming.

Mixue, now the world’s largest food and beverage chain by store count with 46,479 locations—surpassing McDonald’s and Starbucks—ranked fifth in IPO proceeds on HKEX for the period. The chain already operates nearly 4,900 overseas outlets, marking a rapid expansion into global markets.

Guming, a popular tea shop chain, ranked eighth amongst the top ten IPOs.

Funds from these IPOs are expected to support product innovation as well as domestic and international growth.

Private equity and venture capital activity also surged in Q2 2025, reaching 228 billion renminbi—more than double the previous quarter and the strongest quarterly total since Q4 2022.

The figure would be even higher when accounting for recently announced deals involving China’s hypermarket giant RT Mart and luxury department store SKP.

Investors are showing strong interest in two areas: asset-heavy retail and quick-service restaurant chains seeking strategic partners to optimise costs, introduce innovative store formats, and expand into lower-tier cities and international markets; and global brands backed by Chinese private equity firms aiming to accelerate expansion across China and Asia.

Success stories such as Amer Sports, which built a global brand targeting China’s growing middle class, serve as a model.

Chinese private equity investors are increasingly seeking opportunities in Southeast Asia and Europe, looking for companies that can benefit from Chinese technology and innovation.