Alibaba Group Holding has made a significant move by shifting its listing status to Hong Kong, granting access to its shares for China’s 220 million stock investors starting August 28. Previously a secondary listing, it now holds a dual-primary status, allowing direct trading by Chinese investors through the Stock Connect channel. This strategy aims to share capital gains with domestic investors and increase liquidity for the tech behemoth, which first listed in New York in 2014 and in Hong Kong in 2019.
With a market value of HK$1.58 trillion (US$202.7 billion), Alibaba’s entry into the Stock Connect could attract up to US$12 billion in mainland investments. This move seeks to rejuvenate the stock, which has seen a 70% drop in market cap since October 2020.
Despite challenges such as slowed revenue growth and competition, Alibaba’s strategic decision to shift to a dual-primary listing and pursue Stock Connect inclusion is seen as pivotal. This move not only impacts capital gains but also strategically repositions the company in a dynamic market. Investors and analysts are closely monitoring this development, recognizing its potential to reshape Chinese and Hong Kong market dynamics.