SSE said to be gearing up for new emerging industries board

September 29, 2015 12:00
Hong Kong can also benefit from Shanghai Stock Exchange's planned new board for strategic emerging industries, say Wilson Chow (L) and Benson Wong of PwC. Photo: HKEJ

Shanghai Stock Exchange could launch by the end of this year a new strategic emerging industries board that will seek to attract listings of firms involved in sectors getting a policy push from the central government.

The new board will facilitate IPOs of firms in industries that are supported by government policies, including the technology, media and telecommunications (TMT) sectors, according to Wilson Chow, China and Hong Kong assurance leader for TMT at PricewaterhouseCoopers Shenzhen.

Among other initiatives, the board will aim to lure overseas-listed Chinese TMT firms to return to the country for domestic share floats, the Hong Kong Economic Journal cited Chow as saying.

Technology and bio-sciences firms, which usually incur huge expense on research and development, will be provided assistance in fund-raising activities, with the new board offering a favorable regulatory environment and easier rules.

Benson Wong, a PwC audit partner, said the new board could benefit Hong Kong if the local stock market operator, Hong Kong Exchanges and Clearing Ltd. (00388.HK), seeks dual-listing deals of technology companies by relaxing some of its own listing rules.

In other comments, Wong suggested that companies may be better off by listing in their home countries.

He noted that Alibaba Group, for instance, has seen its share price fall by a third since early steep gains following its listing on the New York Stock Exchange last year.

Despite potential high valuations that US listings may bring, it is actually the people in the home country that should be banked upon as they would have better knowledge of the business, he said.

Hong Kong, given its proximity and ties to China, is also an attractive option for Chinese tech firms, Wong added.

[Chinese version中文版]

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Hong Kong Economic Journal