Hong Kong Proactively Facilitating China Concept Stocks Return for a Win-Win
Hong Kong Proactively Facilitating China Concept Stocks Return for a Win-Win
The source text is in Chinese. This English version is for reference only. In case of any discrepancy between this English version and the Chinese version, the Chinese version shall prevail.
The Mainland battery giant, Contemporary Amperex Technology Co., Ltd. (CATL) (03750), launched its initial public offering (IPO) and listed in Hong Kong in mid-May, demonstrating the city’s continued attractiveness as a capital-raising platform for Mainland enterprises.
Despite the recent easing of Sino-US trade tensions, the uncertainty of US policy towards China has prompted an increasing number of US-listed Mainland companies to consider secondary or dual listings in Hong Kong, or to privatise and relist in the city as a fallback strategy for risk diversification. Hong Kong must seize this opportunity, proactively engage these companies, and establish more convenient channels for their return.
27 Companies with Total Market Cap of USD 184 Billion Yet to List in Hong Kong
Hong Kong has been ranked as the world's largest IPO centre for 7 times since 2009. However, the IPO market experienced a slowdown over the past few years due to COVID-19 and geopolitical factors, resulting in a ninth-place ranking in 2022. Nevertheless, entering 2025, a clear trend of recovery is emerging. In the first quarter of this year, a total of HKD 18.2 billion was raised, marking a nearly threefold year-on-year increase.
As of 29 April 2025, 391 Mainland companies were listed in the US stock market, with a combined market capitalisation close to USD 1 trillion, of which over 70% were from companies listed both in Hong Kong and the US.
In addition to dual listings in the US and Hong Kong, companies may also privatise for risk diversification. For instance, Geely (00175) recently announced plans to privatise its US-listed subsidiary Zeekr. Subject to completion, Zeekr will become a wholly-owned subsidiary of Geely and delist from the New York Stock Exchange.
According to Goldman Sachs' estimation, there are 27 eligible China concept stocks not yet listed in Hong Kong, totalling a market capitalisation of USD184 billion. Among these, Pinduoduo accounts for more than half of the total, with a market capitalisation exceeding USD 100 billion. If Hong Kong proactively engages these major enterprises to return, an increasing number of Chinese assets with high quality and growth potential will enter the local stock market. Creating a win-win situation, this will also alleviate the pressure on the enterprises to delist due to regulatory risks in the US.
Looking forward, Hong Kong Exchanges and Clearing Limited (HKEX) (00388) should proactively engage the eligible that have not yet returned. The willingness and convenience of them to list in Hong Kong can be enhanced through the provision of tailored services, such as handling the application process expeditiously and coordinating cross-border regulatory arrangements. Furthermore, feasibility studies should be conducted to explore diversified listing channels and transitional mechanisms for smaller companies, particularly emerging technology enterprises not yet meeting main-board listing thresholds, paving their path back to Hong Kong.
Advocating for a Dedicated Office to Attract China Concept Stocks Return
Moreover, HKEX could consider establishing a "China Concept Stock Return Office" to provide "one-stop services" covering listing applications through to ongoing regulatory compliance. To address the liquidity issue faced by small and medium-sized enterprises, long-term funding and institutional investors should be encouraged to participate. Regarding information disclosure, simplifying disclosure requirements that duplicate Hong Kong regulations for eligible enterprises could further incentivise their return.
Lowering Thresholds to Broaden Scope of Returning Enterprises
Recently, market reports indicated HKEX is considering significantly lowering the market capitalisation criteria for secondary listings of China concept stocks, adjusting from the current thresholds of "market capitalisation of HKD 40 billion, or HKD 10 billion with annual revenue of HKD 1 billion," to "market capitalisation of HKD 3 billion (overseas-listed for at least 5 years)" or "market capitalisation of HKD 10 billion (listed for at least 2 years)." If implemented, this new practice will substantially expand the scope of enterprises eligible for return, attracting more China concept stocks to return and list in Hong Kong.
As institutional reforms are deepening and the capital platform is becoming more sophisticated, Hong Kong is gradually building a more inclusive and competitive listing ecosystem. It can be foreseen that Hong Kong will become the "bridgehead" of the next wave of returning China concept stocks.
The source text is in Chinese. This English version is for reference only. In case of any discrepancy between this English version and the Chinese version, the Chinese version shall prevail.
The Mainland battery giant, Contemporary Amperex Technology Co., Ltd. (CATL) (03750), launched its initial public offering (IPO) and listed in Hong Kong in mid-May, demonstrating the city’s continued attractiveness as a capital-raising platform for Mainland enterprises.
Despite the recent easing of Sino-US trade tensions, the uncertainty of US policy towards China has prompted an increasing number of US-listed Mainland companies to consider secondary or dual listings in Hong Kong, or to privatise and relist in the city as a fallback strategy for risk diversification. Hong Kong must seize this opportunity, proactively engage these companies, and establish more convenient channels for their return.
27 Companies with Total Market Cap of USD 184 Billion Yet to List in Hong Kong
Hong Kong has been ranked as the world's largest IPO centre for 7 times since 2009. However, the IPO market experienced a slowdown over the past few years due to COVID-19 and geopolitical factors, resulting in a ninth-place ranking in 2022. Nevertheless, entering 2025, a clear trend of recovery is emerging. In the first quarter of this year, a total of HKD 18.2 billion was raised, marking a nearly threefold year-on-year increase.
As of 29 April 2025, 391 Mainland companies were listed in the US stock market, with a combined market capitalisation close to USD 1 trillion, of which over 70% were from companies listed both in Hong Kong and the US.
In addition to dual listings in the US and Hong Kong, companies may also privatise for risk diversification. For instance, Geely (00175) recently announced plans to privatise its US-listed subsidiary Zeekr. Subject to completion, Zeekr will become a wholly-owned subsidiary of Geely and delist from the New York Stock Exchange.
According to Goldman Sachs' estimation, there are 27 eligible China concept stocks not yet listed in Hong Kong, totalling a market capitalisation of USD184 billion. Among these, Pinduoduo accounts for more than half of the total, with a market capitalisation exceeding USD 100 billion. If Hong Kong proactively engages these major enterprises to return, an increasing number of Chinese assets with high quality and growth potential will enter the local stock market. Creating a win-win situation, this will also alleviate the pressure on the enterprises to delist due to regulatory risks in the US.
Looking forward, Hong Kong Exchanges and Clearing Limited (HKEX) (00388) should proactively engage the eligible that have not yet returned. The willingness and convenience of them to list in Hong Kong can be enhanced through the provision of tailored services, such as handling the application process expeditiously and coordinating cross-border regulatory arrangements. Furthermore, feasibility studies should be conducted to explore diversified listing channels and transitional mechanisms for smaller companies, particularly emerging technology enterprises not yet meeting main-board listing thresholds, paving their path back to Hong Kong.
Advocating for a Dedicated Office to Attract China Concept Stocks Return
Moreover, HKEX could consider establishing a "China Concept Stock Return Office" to provide "one-stop services" covering listing applications through to ongoing regulatory compliance. To address the liquidity issue faced by small and medium-sized enterprises, long-term funding and institutional investors should be encouraged to participate. Regarding information disclosure, simplifying disclosure requirements that duplicate Hong Kong regulations for eligible enterprises could further incentivise their return.
Lowering Thresholds to Broaden Scope of Returning Enterprises
Recently, market reports indicated HKEX is considering significantly lowering the market capitalisation criteria for secondary listings of China concept stocks, adjusting from the current thresholds of "market capitalisation of HKD 40 billion, or HKD 10 billion with annual revenue of HKD 1 billion," to "market capitalisation of HKD 3 billion (overseas-listed for at least 5 years)" or "market capitalisation of HKD 10 billion (listed for at least 2 years)." If implemented, this new practice will substantially expand the scope of enterprises eligible for return, attracting more China concept stocks to return and list in Hong Kong.
As institutional reforms are deepening and the capital platform is becoming more sophisticated, Hong Kong is gradually building a more inclusive and competitive listing ecosystem. It can be foreseen that Hong Kong will become the "bridgehead" of the next wave of returning China concept stocks.
