Beyond Didi: Watch These Homecoming China Stock Listings in 2022

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(Bloomberg) -- With Didi Global Inc. seeking a listing successful Hong Kong little than a twelvemonth aft its tumultuous debut successful New York, investors are looking for different U.S.-traded Chinese names that could perchance connection shares person to location amid regulatory pressures.

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Such alleged “homecomings” are a blistery taxable successful the Asian fiscal hub arsenic U.S. authorities measurement up demands implicit disclosures and Chinese officials question to reel successful overseas offerings citing information concerns. Listing successful Hong Kong is seen arsenic an alternate for firms wanting to clasp entree to planetary investors portion being much palatable to Beijing. It is besides simpler and quicker than a mainland deal.

The regulatory threats mean companies with a full marketplace headdress of astir $200 cardinal presently listed lone successful the U.S. whitethorn request to question a instrumentality to Hong Kong oregon the mainland soon, Bloomberg Intelligence analysts Matthew Kanterman and Tiffany Tam wrote successful a note. A database compiled by Bloomberg News includes Pinduoduo Inc. and Nio Inc. among the largest names.

Didi could record with the Hong Kong Stock Exchange astir March, radical with cognition of the substance person told Bloomberg News. It is poised to articulation implicit a twelve Chinese firms that person already completed 2nd listings successful the metropolis aft making planetary debuts done American depositary receipts, including JD.com Inc. and Alibaba Group Holding Ltd.

“Many of the large communal funds are successful the process of oregon person converted the bulk of their ADR vulnerability into Hong Kong shares for stocks which are presently dual listed, suggesting a earthy migration to Hong Kong is taking place,” said Alex Abagian, co-head of Asia Pacific equity superior markets astatine Morgan Stanley.

Below are the U.S.-traded companies that could travel up with homecoming listings:

Pinduoduo

The e-commerce relation is the biggest Chinese institution by marketplace capitalization listed lone successful the U.S. Founded by Colin Huang, it has been 1 of the fewer large net giants to flight a nonstop deed from Beijing’s wide-ranging tech crackdown. The firm’s ADRs roseate to a grounds precocious successful New York successful February, but person slumped astir 70% since amid a selloff successful Chinese shares globally.

Nio

The electric-vehicle shaper could beryllium acceptable to travel peers XPeng Inc. and Li Auto Inc., which launched 2nd superior listings successful Hong Kong this year. Nio this period unveiled its 2nd sedan, which volition vie much straight with Tesla Inc.’s astir fashionable Model 3. Its ADRs are down astir 50% from their February all-time high.

KE Holdings Inc.

The Beijing-based online lodging level was a people of short-seller Muddy Waters Research this month. KE said the study is “without merit” and that it has authorized an interior reappraisal of Muddy Waters’ cardinal allegations. The interaction has been minimal connected the ADRs, which were already down much than 70% from a grounds precocious successful February.

Kanzhun Ltd.

The Beijing-based proprietor of online recruitment level Boss Zhipin surged successful its U.S. debut successful June, and has managed to commercialized good supra listing terms since past contempt the volatility that has dominated Chinese names. Its ADRs are up 73% since listing. (Market headdress $13.5 billion)

Tencent Music Entertainment Group

The euphony amusement company, a rival to NetEase Inc.’s Cloud Village Inc., debuted successful New York implicit 3 years ago. The steadfast is well-positioned to seizure a portion of the burgeoning $800 cardinal metaverse marketplace done its virtual performance business, according to Bloomberg Intelligence. Its ADRs person fallen 80% from a March highest to astir fractional of their 2018 IPO price. (Market headdress $11 billion)

Futu Holdings Ltd.

The Chinese online brokerage is readying to record for a Hong Kong listing that could rise astir $1 billion, IFR reported successful October. Its ADRs person fallen astir 80% from a February grounds precocious though they’re inactive trading astatine astir 3 times their March 2019 IPO price. (Market headdress $6 billion)

IQiyi Inc.

The video-entertainment work relation has slumped implicit 80% since precocious March, deed by fears that Chinese tech giants would beryllium kicked disconnected U.S. bourses. The Baidu Inc. subsidiary was said to person picked banks for a Hong Kong 2nd listing, according to a Bloomberg News study successful October. (Market headdress $3.9 billion)

READ: Budget Retailer Miniso Said to Consider Hong Kong Listing

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