ChiNext, Star Market, China’s rival tech boards, target Hong Kong ‘red chip’ secondary listings as competition heats up

China’s two Nasdaq-styled technology exchanges are locked in a tight race for home-grown businesses listed in Hong Kong

Listing approval times, strategic positioning and valuations of the Shanghai and Shenzhen bourses differ between the established ChiNext and its much younger challenger

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Chinese investors monitor stock prices at a brokerage house in Beijing. Photo: AP

Published: 2:00pm, 15 Aug 2020Updated: 2:00pm, 15 Aug 2020

The battlefield on which China’s Nasdaq-styled technology boards in Shanghai and Shenzhen compete for listings has expanded beyond start-ups and billion-dollar tech unicorns.

The two exchanges have been locked in a tight race as they try to win business from established Chinese companies listed in Hong Kong.

Both the Science and Technology Innovation Board, also known as the Star Market, in Shanghai, and the ChiNext board in Shenzhen have in recent months introduced market-friendly reforms targeting so-called red chip companies – enterprises that have their businesses based in mainland China but are incorporated offshore.

Heeding the call to “return home”, Geely Auto, the owner of Volvo cars, disclosed in June its plans to seek a second listing on the Star Market. One of its competitors, Dongfeng Motor, said in July it has opted instead to list on ChiNext.

Earlier this month, loss-making Cansino Biologics, which has a coronavirus vaccine under trial, priced its secondary listing on the Star Market at 209.71 yuan (US$29.96) a share as the second-highest priced IPO in China. Its success echoed that of chip maker SMIC, which raised US$7.6 billion on the same bourse in July, in what was China’s biggest IPO in a decade.

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