Asia’s Booming IPO Pipeline Faces Headwinds as AI Bubble Fears Grow
GeokHub
Contributing Writer
HONG KONG / MUMBAI — Dec 5, 2025 Asia is entering 2026 with a strong backlog of planned equity deals — including IPOs, follow-on share offerings, and convertible bond issuances — largely driven by companies from China and India. In 2025, the region’s equity-capital markets recorded about $267 billion in deals, marking the first annual increase since 2021.
Leading the charge is Hong Kong, with roughly $75 billion in deals this year, while India raised about $19.3 billion through IPOs. Analysts expect upcoming blockbuster listings — such as major technology and infrastructure firms — to further fuel market activity in the year ahead.
But optimism is being tempered by growing concern that surging valuations in AI-related and tech sectors may have overshot fundamentals. Recent volatility in global tech stocks has sparked fears of an “AI bubble,” potentially reducing investor appetite for high-growth, high-valuation IPOs. Companies in sectors heavily tied to AI — including software, chipmakers and emerging-tech firms — may see weaker demand or need to revise valuation expectations if sentiment sours.
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Some market watchers argue the uncertainty may benefit more traditional or stable companies whose value is rooted in earnings and cash flow rather than speculative growth. For now, Asia’s equity-deal pipeline remains intact — but its success may depend on whether investors stick to long-term conviction or retreat amid risk aversion.
