On 19 December 2024, the Stock Exchange of Hong Kong Limited (the “Exchange”) published a consultation paper seeking market feedback on proposals to optimise IPO price discovery and open market requirements. The objective of the proposals is to ensure the Exchange’s listing mechanism remains attractive and competitive for existing and prospective issuers.
In particular, the Exchange proposes to:
- Review open market requirements, ensuring issuers will have sufficient shares in public hands that are available for trading at listing, while relaxing certain percentage thresholds which would imply a bar that may be too high in absolute dollar value.
- Optimise the price discovery process for IPOs to increase the participation of “price setting” investors, thereby reducing the likelihood of the final offer price being set at a large disparity to the actual trading price when dealing in those shares commence.
The Exchange invites public comments on their proposals until Wednesday, 19 March 2025. After reviewing all responses and comments, the Exchange will develop consultation conclusions and final amendments to the Listing Rules.
