In early 2026, Hong Kong-listed companies are tapping strong equity market sentiment to issue convertible bonds, with eleven firms raising US$7.4 billion in the first five weeks—nearly half of last year's total. Bankers expect the trend to continue as companies seek to lock in high share prices.
A growing number of Hong Kong-listed companies are issuing convertible bonds amid strong equity market sentiment, a trend bankers expect to persist. According to Dealogic, eleven companies raised US$7.4 billion through convertible bonds in the first five weeks of 2026, accounting for about 47 per cent of last year's US$16 billion total.
Tianqi Lithium, one of the world's largest producers of lithium-ion battery materials, announced on Wednesday it would raise about HK$5.9 billion (US$755 million) via a combination of share placement and a convertible bond. This followed leading Chinese broker Huatai Securities' announcement the day before to raise HK$10 billion through a convertible bond. Earlier, Chinese sportswear group Xtep said it would issue HK$500 million in convertible bonds to institutional investors.
"The volume has been pretty crazy since the beginning of January," said Olivia Li, who leads the Greater China equity-linked business at Citi. She added, "The key reason is that the equity market has started pretty strong this year. So everyone is trying to take advantage of the current high share prices to raise money by issuing equity-linked instruments, such as convertible bonds."
Convertible bonds are securities that can be converted into shares at a predetermined price, typically set at a premium to the current share price. When share prices are high, issuers can fix a higher conversion price, boosting investor confidence that the stock will rise enough to make conversion worthwhile.
Market players noted that the number of companies rushing to issue convertible bonds is growing, with bankers busy on deals even as Lunar New Year approaches. This surge underscores optimistic sentiment in Hong Kong's stock market, allowing firms to capitalize on elevated valuations for fundraising.