Alibaba gains as it swaps listing status in Hong Kong to tap mainland China investments
- The move would qualify the technology behemoth to sell shares to mainland China’s 220 million stock investors possibly starting on September 9, which could attract US$12 billion in funds
The new designation would qualify Alibaba’s shares for the Stock Connect cross-border investment channel when the exchange operators of Shenzhen and Shanghai convene on September 5 to review what to add into the programme. Alibaba, one of China’s largest technology behemoths with HK$1.58 trillion (US$202.7 billion) in value for its Hong Kong listing, would be very likely to make the cut, clearing the way for mainland investors – those with at least 500,000 yuan (US$70,089) in assets – to take their first bite of the stock on September 9 the earliest.
“It will bring a tailwind to Alibaba’s shares for sure, and inject liquidity” into the stock, said Dai Ming, a fund manager at Huichen Asset Management in Shanghai. “It does make a huge difference in terms of whether stocks can be traded through the Stock Connect.”
Alibaba’s shares advanced 1.2 per cent amid a declining market to HK$82.65 in Hong Kong after the announcement, their highest level since May 22. The Hang Seng Index, the city’s market benchmark, fell 0.2 per cent.
The journey of Alibaba’s shares to New York and back on China’s doorstep was 10 days shy of a decade in the making. The company’s founders had long rued the fact that Alibaba, which earns most of its revenue from China, could not share its capital gains with the nation’s legion of stock investors.
