Hong Kong-listed mainland firms head home as city loses shine

Weak trading volume and cheap valuations mean Hong Kong is losing its shine as a financing ­platform, prompting mainland companies to delist from the city’s stock exchange and head home.

Shenzhen-based Logan Property is believed to be the latest planning to leave the city, following Wanda Commercial and Peak Sport.

“The Hong Kong market is no longer attractive,” Kingston Lin, security brokerage director at Hong Kong-based AMTD, said. “Capital is not flowing into Hong Kong as foreign investers are worried about China’s ­economy.”

Lin said that in the past five years, mainland blue-chip companies in Hong Kong had been trading at an average of only 10 times earnings.

Wednesday night, Logan Property said in an announcement to the Hong Kong stock exchange that its billionaire chairman, Kei Hoipang, was in negotiations with a Shanghai-listed firm on a possible share transfer. Trading in Logan Property was suspended yesterday pending the announcement.

Shanghai-listed China Jialing Industrial said on Tuesday that Logan Infrastructure, a sister company of Logan Property, would acquire all China Jialing’s shares for 1.82 billion yuan (HK$2.15 billion). Logan Infrastructure would then conduct a share placement to acquire the controlling stake in Logan ­Property.