Home News Global Markets

Why a primary listing in Hong Kong matters for Alibaba, BiliBili

Bloomberg7/26/2022 08:14 PM GMT+08  • 3 min read
Why a primary listing in Hong Kong matters for Alibaba, BiliBili
Photo: Bloomberg
Font Resizer
Share to WhatsappShare to FacebookShare to LinkedInMore Share
Scroll to top
Follow us on Facebook and join our Telegram channel for the latest updates.

The decision by Alibaba Group Holding to change its listing status in Hong Kong to “primary” from “secondary” is a move similar to that taken by other companies in the Asian hub recently and might spur others to do the same. What are reasons for such a switch?

1. What is a primary listing?
It refers to the main stock exchange where a public company’s shares are traded. In order to list, a firm has to fulfill requirements of that market. Secondary listings, often subject to less-stringent regulation, offer a separate trading venue that may increase liquidity in trading of the shares and provide access to a wider pool of investors -- a key in the case of Hong Kong.

2. Why are US-listed companies switching status in Hong Kong?
It’s a necessary step to gain access to the Stock Connect link with the Shanghai and Shenzhen exchanges, which will expand access to investors in mainland China. The move is increasingly important because US-listed Chinese companies are under intense scrutiny by US regulators. If a company is eventually forced to de-list in New York, its Hong Kong stock may already hold primary status. Among the pioneers with dual-primary listings in Hong Kong are electric-vehicle makers XPeng Inc. and Li Auto Inc. Still, companies also need to meet other criteria related to their listing-period abroad and market capitalization to be included into the Stock Connect link.

For more insights on corporate trends...
Sign In or Create an account to access our premium content.
Subscription Entitlements:
Less than $9 per month
Unlimited access to latest and premium articles
3 Simultaneous logins across all devices
Bonus unlimited access to online articles and virtual newspaper on The Edge Malaysia (single login)
Loading next article...
The Edge Singapore
Download The Edge Singapore App
Google playApple store play
Keep updated
Follow our social media
Subscribe to The Edge Singapore
Get credible investing ideas from our in-depth stock analysis, interviews with key executives, corporate movements coverage and their impact on the market.
© 2022 The Edge Publishing Pte Ltd. All rights reserved.