Chinese mainland companies listed in Hong Kong will soon be allowed to freely convert nonlisted shares into H-shares, China’s top stock market regulator said.
Yi Huiman, head of the China Securities Regulatory Commission, said Thursday in Shanghai that H-share full-convertibility will go into effect soon. Pilot tests of the reform have been underway for more than a year.
Mainland companies listed in Hong Kong usually have less than half of their shares traded on the Hong Kong Stock Exchange as H-shares, while the rest of their stock can become convertible only after gaining regulatory approval.
The full-convertibility change will enhance the vitality of the Hong Kong stock market and benefit stockholders as more shares can become freely convertible assets, analysts told Caixin.
The move will help many mainland state-owned enterprises that are listed in Hong Kong to raise more capital abroad, which will in turn contribute to ongoing mixed-ownership reforms aimed at reinvigorate the state sector, analysts said.