Despite IPO dominance, China-focused investors see rising need to diversify exit routes

While initial public offerings (IPOs) remain the main exit route for China-focused fund managers, pent-up stock markets are driving more of them to look at alternatives amid a rising emphasis on diversified exit strategies.

Private equity (PE) and venture capital (VC) fund managers in China have fared better than their overseas counterparts in terms of IPO exits — largely through local stock exchanges in mainland China and Hong Kong — over the past few COVID-ridden years as the global capital markets tumbled.