Alibaba eyes windfall gains from HK move

Tech heavyweight Alibaba Group Holding Ltd said on Friday its voluntary conversion of secondary listing to primary listing on the Hong Kong stock exchange will become effective on Wednesday, a move experts said will attract billions of dollars in investment from the Chinese mainland via the stock connect program linking the Shanghai, Shenzhen and Hong Kong bourses. "The dual primary listing of Alibaba in the Hong Kong and New York bourses will help the company further expand investor base, especially those from the Chinese mainland and other markets in Asia, promote the diversification of its shareholder structure and enhance the liquidity of Alibaba's shares in the Hong Kong bourse," said Jiang Han, a senior researcher at the Beijing-based think tank Pangoal Institution. The conversion to primary listing in Hong Kong is expected to allow Alibaba to be included in the Shanghai-Hong Kong and Shenzhen-Hong Kong Stock Connect programs, which will let Chinese mainland investors directly invest in Alibaba, bring about more southbound capital flows to the company and provide a strong support for its long-term growth, he said. Zhu Keli, founding director of the China Institute of New Economy, said the reason behind Alibaba's primary listing in Hong Kong appears to be that "the tech giant aims to mitigate potential risks and reduce uncertainties from, and dependence on, a single market amid an increasingly complex and volatile international environment, as well as broaden its financing channels, in a bid to support its continuous business expansion and investments in tech innovation."