SF Express has moved a step forward in its secondary listing in Hong Kong as the Chinese express delivery giant has been given the green light by the country’s securities regulator to go public.
According to its announcement late on Sunday, the Shenzhen-based company got the approval from China Securities Regulatory Commission to issue no more than 625 million shares in Hong Kong.
The company said earlier it was launching its initial public offering (IPO) in Hong Kong in a move to further promote its internationalization strategy, build a capital operation platform, enhance its brand image and improve its overall competitiveness.
Proceeds from the share sales will be used to boost the coverage of its logistics services and network in Asia, especially in Southeast Asia, it said.
SF Express made its primary IPO on the Shenzhen Stock Exchange in 2017. If it successfully goes public in Hong Kong, the company will become the first delivery firm in the country to be listed both in Hong Kong and on the mainland.
SF Express made its primary IPO on the Shenzhen Stock Exchange in 2017. If it successfully goes public in Hong Kong, the company will become the first delivery firm in the country to be listed both in Hong Kong and on the mainland
The Shenzhen-based company generated 258.41 billion yuan ($35.7 billion) in operating revenue in 2023, down 3.39 percent year-on-year. Net profit grew 33.38 percent on a yearly basis to 8.23 billion yuan last year.
The development is expected to boost sentiment among investors amid lackluster performance of Hong Kong’s IPO market, which saw relatively small deals in the first quarter compared with previous years.
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A total of 12 companies were listed in Hong Kong in the first three months, raising HK$4.73 billion ($605 million). That translated into HK$394 million for each on average. The number of share listings and the total value represented a 33 percent and 29 percent decline respectively compared with the same period last year.
Bonnie Chan, CEO of Hong Kong Exchanges and Clearing Limited, the city’s bourse, said Hong Kong has seen 20 small scale IPOs so far this year, while over 100 companies have filed listing applications.
Low valuation, regulatory support and investment in emerging sectors are three factors that could boost Hong Kong’s stock market, she said at an event last week.
With investors’ sentiment gradually recovering, Hong Kong could see a “good deal” of new listings this year, she added.
While noting that market sentiment in Hong Kong’s stock market has significantly improved from the start of the year, Chan said it is too early to declare victory.
Hong Kong’s benchmark Hang Seng Index rebounded by 33 percent to a near 10-month high of 19,706.12 on May 20 from January’s low of 14,794.16. The index advanced 1.79 percent to finish at 18403.04 on Monday.
Investment sentiment by foreign investors and the US interest rate change will impact the performance of Hong Kong stocks, said Yan Zhaojun, a securities strategist at Zhongtai International.
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He forecast Hong Kong stocks have room for further rebound this year, with the HSI expected to fluctuate between 17,150 and 19,300 in June.
