Stock Connect to add primary dual-listed firms

Staff reporter and Reuters

Stock exchanges in Shanghai and Shenzhen will include dual-listed Chinese companies in the Stock Connect after they convert to be primarily listed in Hong Kong, such as Alibaba (9988) and Bilibili (9626), enabling mainland investors to support the overseas listed tech firms.

The Stock Connect is an investment channel that connects the Hong Kong, Shanghai, and Shenzhen stock exchanges.

Taking the Shanghai-based video platform Bilibili as an example, the bourse in Shanghai said its shares can be added to the Southbound leg of the Connect scheme as soon as March if they meet certain conditions.

Bilibili's case meets the requirement that the company has been listed in Hong Kong for six months and the following 20 trade days when it converted its secondary listing in Hong Kong to a primary listing on October 3. Then the Shanghai Stock Exchange will conduct a review of whether the company could be added to the Stock Connect.

A growing number of China's dual-class companies, including e-commerce giant Alibaba Group and fast-food restaurant chain operator Yum China (9987), also have applied to convert their secondary listings in Hong Kong to primary ones.

Alibaba's application is expected to be approved before the year-end, which means mainland investors could buy its shares through the Southbound leg next year.

The bourses said they will track closely the dual-listed Chinese companies' status in Hong Kong and include the eligible ones in the Stock Connect, in an attempt to further open the capital market mutually.

In other news, China will continue to diversify investment products in offshore yuan markets like Hong Kong, aiming to promote the positive circulation of yuan in both onshore and offshore markets, said the country's central bank.

Moreover, the People's Bank of China said it will facilitate direct trading of yuan with the currencies of some countries and support overseas countries and regions to develop local yuan-denominated foreign exchange markets.