Hong Kong IPO Mechanism A vs Mechanism B: how much goes to retail
Since 4 August 2025 every Hong Kong IPO with a public subscription tranche picks one of two allocation mechanisms. The prospectus says which one.
Mechanism A: 5% initial, clawback by demand
| Public tranche demand (× initial allocation) | Share of offer shares to public tranche |
|---|---|
| below 15× | 5% (initial) |
| 15× to below 50× | 15% |
| 50× to below 100× | 25% |
| 100× or more | 35% |
Mechanism B: fixed, no clawback
The issuer pre-sets the public tranche at a minimum of 10% and at most 60% of the offer shares, with no clawback. The 60% cap exists because at least 40% must initially go to the bookbuilding placing tranche.
Specialist Technology Companies (Chapter 18C)
Bespoke mechanism: 5% initial, 10% at 10× or more, 20% at 50× or more.
Your real odds come from the allotment results announcement: successful applicants ÷ valid applications at your application size. Enter that in the calculator to get expected values.
Sources: HKSAR Government press release "LCQ9: Measures to optimise initial public offering market" (13 May 2026), info.gov.hk, Notes 1–2; SEHK Consultation Conclusions on IPO Price Discovery and Open Market Requirements (1 Aug 2025, effective 4 Aug 2025); Main Board Listing Rules Practice Note 18 para 4.2.