According to the rules, in addition to the temporary adjustment of A+H shares that are subject to risk warning, delisting and suspension, Hong Kong Stock Connect is mainly adjusted with the adjustment of the constituent stocks of Hang Seng Composite Index, so it is necessary to study the adjustment rules of Hang Seng Composite Index to predict the changes of Hong Kong Stock Connect.
After the adjustment of index constituent stocks takes effect on September 5, 2022, the Shanghai and Shenzhen Stock Exchanges will adjust the scope of investable targets of Shanghai-Shenzhen-Hong Kong Stock Connect accordingly (the specific time is subject to the announcement of the Exchange). Let's take a look at the listed companies that are likely to be included in or excluded from Hong Kong Stock Connect in September according to the index adjustment rules.
1. It is expected that China Huarong and Kuaidi taxis will be included, while cloud music and Jinke services will be excluded.
First, use the following indicators to screen the potential inclusion list of Hong Kong Stock Connect:
1. Determine the selection range of Hang Seng Composite Index, that is, all listed companies on the main board of Hong Kong stock market after excluding investment companies.
2. Screen out the securities with the cumulative market value coverage of 94% within the selection range of Hang Seng Composite Index.
3. Eliminate the securities that are already on the existing Hong Kong Stock Connect list.
4. Refer to the website of the Hong Kong Securities Regulatory Commission, and eliminate the securities with excessively concentrated equity.
5. Exclude foreign companies, SS subscription securities and REITs.
6. Screening out the securities whose liquidity meets the requirements: Due to the lack of free market value factor of HKEx, the average monthly turnover rate (based on free circulating share capital) is selected as the substitute index here, and if there is no data, the average monthly turnover rate (based on issued share capital) is used as the substitute index.
After the above steps, the institution Everbright screened out the list of potential companies to be included in the Hong Kong Stock Connect in September: Yun Kang Group, Shengnuo Pharmaceutical -B, Ruier Group, Dragonair China Real Estate, Datang New Energy, Xinte Energy, Conch Environmental Protection, IDG Energy Investment, Bohai Bank, China Huarong, Xinli International, Fast Dog Taxi, Hong Kong Aerospace Science and Technology, Huitong Network, AsiaInfo Technology, Innovative Wisdom, Dream World and so on.
In addition, companies with different rights in the same share are expected to be included at different times. It is estimated that around 2023 12, Shell -W will be included in the Hong Kong Stock Connect.
The following indicators are used to screen the exclusion list of Hong Kong Stock Connect, which is in the original list of Hong Kong Stock Connect:
1. Does not meet liquidity requirements: screening out the securities that do not meet liquidity test. Here, the average monthly turnover rate (based on freely circulating share capital) is selected as a substitute index, and if there is no data, the average monthly turnover rate (based on issued share capital) is used as a substitute index.
2. Failure to meet the market value requirements: Shenzhen Stock Connect needs to transfer out the constituent stocks of Hang Seng Composite Small Cap Index that do not meet the market value requirements. Therefore, targets with a market value of less than HK$ 5 billion or a cumulative market value coverage of over 96% in the current Hang Seng Composite Index will be excluded. The market value here refers to the market value calculated by the calculation method of Hang Seng Company, that is, the number of shares issued at the end of each month multiplied by the stock price.
3. Remove H shares containing A shares from the list of unqualified securities.
Finally, the list of companies that may be excluded from the Hong Kong Stock Connect in September includes: Cloud Music, Jinke Service, Zhengshang Industry, Voice, Jingxin Communication, Greenland Hong Kong, Hebo Pharmaceutical -B, Chaoyun Group, China Trend, Jiahe Bio -B, Tian Li International Holdings, Jianye Real Estate, Jiutai Bangda Energy, Yiju Enterprise Holdings, Huaxia Audio-visual Education, Yao Ming Junuo-
2. When will Alibaba be included in the Hong Kong Stock Connect?
Alibaba recently announced that the board of directors has authorized the management of the Group to submit an application to the Hong Kong Stock Exchange to add China Mainland and Hong Kong as the main listing locations. Alibaba will be listed on the main boards of the Hong Kong Stock Exchange and the New York Stock Exchange, which is expected to take effect by the end of 2022.
Alibaba actively promotes the "double listing", one of the important reasons is to reduce the risk of being delisted by the US Securities and Exchange Commission. Secondly, Alibaba -SW was a "secondary listing" in Hong Kong stocks before. If it successfully promotes the listing on the Hong Kong Stock Exchange, it is expected to be included in the Hong Kong Stock Connect list soon, attracting funds from the south to increase liquidity.
Let's take a look at the case before Zaiding Pharmaceutical. On June 27, 2022, Zaiding Pharmaceutical completed the conversion from the secondary listing on the main board of Hong Kong Stock Exchange to the dual listing, and transferred to Hong Kong Stock Connect on the same day.
If all the regulations of the Shanghai and Shenzhen Stock Exchanges contain different ownership structures of the same share, as long as they have been listed on the Hong Kong Stock Exchange for more than 6 months +20 working days, they can also be transferred to the Hong Kong Stock Connect on the same day as they become dual listed companies. Therefore, Alibaba -SW and Billie -SW, which have been listed on the Hong Kong stock market for more than 7 months, can be included in the Hong Kong Stock Connect in a short time after being transformed into dual listed companies.
In other words, it is speculated that if Alibaba successfully completes the main listing of the main board of the Hong Kong Stock Exchange at the end of this year, it will be at the end of this year or early next year at the earliest.
According to statistics, many companies have significantly improved their liquidity after being included in the Hong Kong Stock Connect, and the pricing power of mainland funds to the company's share price has obviously improved.
Referring to Xpeng Motors, which has been included in the Hong Kong Stock Connect, the average daily turnover from the listing date to the day before it was included in the Hong Kong Stock Connect was 259 million yuan. From February 9, 2022 to July 26, 2022, the average daily turnover rose to 655 million yuan. On July 26, 2022, the shareholding ratio of Hong Kong Stock Connect was 3.58% of its total share capital.
The average daily turnover of Li from the listing date to the day before his listing in Hong Kong Stock Connect was 1.3 1 100 million yuan. From March 4, 2022 to July 26, 2022, the average daily turnover rose to 756 million yuan. On July 26th, the shareholding ratio of Hong Kong Stock Connect was 5.52% of its total share capital.
Institutional CITIC estimates that all secondary listed companies that meet the requirements of the above figure will be converted into dual listed companies and included in the Hong Kong Stock Connect. It is predicted that their daily average total turnover will increase by 50% and unilateral daily average turnover will increase by HK$ 5.7 billion. In the first half of 2022, the unilateral ADT (daily average turnover) of Hong Kong stocks was HK$ 65.438+0383 billion, and the daily average turnover of Hong Kong Stock Connect (buy+sell) was HK$ 33.2 billion, which was about 4% of the daily average turnover of the Hong Kong stock market.
Softbank Group, Alibaba's major shareholder, announced that it would reduce its holdings of about 242 million shares of Alibaba American Depositary Receipts by settling prepaid forward contracts, accounting for about 9% of Alibaba's total issued shares, equivalent to a market value of more than 200 billion yuan.
This is relatively negative news for Alibaba, but Softbank's reduction is closely related to its huge losses. In its first quarter financial report, it was mentioned that due to investment mistakes, epidemic situation, global economic situation and other reasons, the company lost 2.33 trillion yen, exceeding 654.38+065.438+063 billion yuan.
On the evening of August 4, 2023, Alibaba announced its performance in the first quarter of fiscal year 2023 (that is, the second quarter of natural year 2022). In the quarter, Alibaba achieved revenue of 205.56 billion yuan, which remained stable year-on-year; Non-GAAP net profit was 30.252 billion yuan, down 30% year-on-year, and both revenue and net profit performance were higher than market expectations.
Zhang Yong, Chairman of the Board of Directors of Alibaba Group, said: "In the past quarter, we actively responded to the changes in the macro environment, and always focused on the long-term strategy by constantly strengthening our ability to create value for our customers. Although the growth rate of our business slowed down relatively in April and May, we saw signs of improvement in June. Based on the high-quality consumer groups we have and the resilience of diversified businesses that meet the different needs of customers, we are full of confidence in the long-term growth in the future. "
Investors can pay close attention to the latest development of Alibaba and China GM's listing in Hong Kong Stock Connect through double major listings.
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