SPECULATION that the Jardine group of companies may soon relist on the Hong Kong stock exchange has gathered pace and credibility since the beginning of May, sending Singapore-traded Jardine Matheson Holdings' shares up almost 35 per cent in the past two months. Any move to get the shares trading in Hong Kong again would be a milestone in the history of the group and of Hong Kong, given Jardine's strong historical connection with the territory. Events in recent months have made the notion of the return of the group's five defecting companies to Hong Kong more realistic. Last month, senior Jardine officials, including Jardine Matheson chairman Henry Keswick and managing director Alasdair Morrison, met senior Chinese cadres in Beijing, including Vice-Premier Zhu Rongji, China's economic chief. This followed comments by Lu Ping, director of the Hong Kong and Macau Affairs Office, to the effect that Jardine, despite China's longstanding resentment towards the group over the 19th-century opium trade, would not be discriminated against if it competed for deals on the mainland. Recent reports have also suggested that China wants to bury the hatchet with Britain and might even offer concessions to British companies that have helped develop Hong Kong. With Jardine being the biggest employer in the territory after the Government, this would seem to suggest that the group could be included in these plans. Relations between Jardine and China soured during the formulation of the Joint Declaration in 1984, when the hong announced it was switching its legal domicile from Hong Kong to Bermuda. Then, in early 1995, the group moved regional share trading of Jardine Matheson, Jardine Strategic Holdings, Hongkong Land Holdings, Dairy Farm International Holdings and Mandarin Oriental International from the territory to Singapore, amid reports that it disagreed with the Securities and Futures Commission on the territory's takeover regulations. The group's support for Governor Chris Patten's political reforms and the consequent blasts from China were also cited as a reason for the move. Only Jardine International Motor Holdings, a small company in which the group holds about 75 per cent, still trades on the Hong Kong stock exchange. The group's shares have since lagged considerably behind the underlying Singapore Straits Times Index. Despite the environment, Jardine officials are, for the time being, still adamant that a re-listing is not on the cards in the foreseeable future. 'When all that speculation started to fly around, following the Zhu Rongji meeting, Alasdair Morrison said quite clearly, on the record, that there are no current plans for a relisting in Hong Kong,' Jardine spokesman Martin Spurrier said. 'The Jardine on-the-record comment is that there are no current plans for a relisting. 'In a speech by Alasdair Morrison in December 1995, he did say 'we hope to be relisted in China one day, either Hong Kong or Shanghai'. So, to the best of my knowledge, it is just not going to happen in the near future.' Brokers said that if the shift was to occur, the group might be pressured into relinquishing some of its holding in Hongkong Land. The move would certainly be a shot in the arm for the companies concerned and for the Hong Kong stock market, brokers said. China would look at the move as a conciliatory gesture, while the market capitalisation of the local exchange would be given a boost. Despite widespread perceptions that the group is disliked in China, it has a presence in 30 cities with 70 joint ventures, which employ 30,000 people.