This photo taken on Feb 1, 2025 shows a city view of Hong Kong. (Photo: Xinhua)
The Hong Kong Special Administrative Region (HKSAR) is looking to capitalize on a wave of returning Chinese companies and is confident that those listed in the city will eventually account for more than 90 percent of the total market capitalization of all Chinese firms listed in the US, HKSAR Financial Secretary Paul Chan Mo-po said on Monday.
At present, those that have already returned to list in Hong Kong or are in the approval pipeline account for more than 80 percent of the total market capitalization of all Chinese firms listed in the US. Hong Kong is confident that the figure will eventually exceed 90 percent, Chan said at a panel on financial affairs, according to Hong Kong-based financial news platform aastocks.com.
Among US-listed Chinese companies, a small number of firms account for the vast majority of their total market capitalization. To safeguard the market's reputation and ensure listing quality, the HKSAR authorities are expected to proactively reach out and invite these high-quality issuers to list in the city. The Hong Kong Exchanges and Clearing Limited (HKEX) has also made corresponding preparations to support their return, Chan said.
The city already has a regulatory framework that facilitates dual or secondary listings for companies listed overseas, Chan previously wrote in a blog post on April 13.
"In light of recent global developments, I have instructed the Securities and Futures Commission and the HKEX to be fully prepared for the potential return of Chinese Concept Stocks listed abroad. The HKEX will also enhance its outreach and promotion in the ASEAN and the Middle East markets to attract more quality enterprises from these regions to list in Hong Kong, while drawing in additional international capital and further strengthening Hong Kong's position as a global financial center," he wrote.
Hong Kong's stock market, as an open and international financial hub with free capital flows, is well placed to welcome more top-tier Chinese concept stocks returning from overseas listings, offering investors access to more high-quality investment options, Yang Delong, chief economist at Shenzhen-based First Seafront Fund, told the Global Times on Monday.
A number of Chinese companies previously listed overseas have already returned to the Hong Kong market, with many showing a strong business performance and solid share price gains. In particular, many of the market's tech and internet companies are returning Chinese firms, including some major internet giants. This year, Hong Kong has seen significant capital inflows, and the Hang Seng Tech Index has hit a new high for the year, further cementing the city's position as a tech-heavy market, Yang said.
As of Monday, the Hang Seng Tech Index had gained 18.66 percent year-to-date, according to Hang Seng Indexes Co.
Recently, international rating agencies Standard and Poor's (S&P) and Moody's made adjustments to Hong Kong's credit rating and outlook. S&P has maintained Hong Kong's "AA+" credit rating with a "stable" outlook, while Moody's has affirmed Hong Kong's "Aa3" credit rating, and upgraded the outlook from "negative" to "stable".
The recent affirmations of Hong Kong's credit ratings by Fitch, S&P and Moody's, all with "stable" outlooks, demonstrate Hong Kong's resilience in maintaining stability amid increasing global economic and financial uncertainties, the HKSAR Government said in a release on May 27.
