HKEX(HK:00388) Zhi Tong Cai Jing·2025-08-01 09:15Core Viewpoint - Hong Kong Stock Exchange (HKEX) announced reforms to optimize the IPO pricing and public market regulations, effective from August 4, 2025, aiming to enhance market flexibility and protect shareholder rights [1][2]. IPO Pricing and Allocation Mechanism - The maximum allocation for retail investors has been increased to 35% from the previously suggested 20% [1][2]. - The minimum allocation for the book-building portion has been set at 40%, down from the original 50% [2]. - Two mechanisms for allocation to the public subscription portion have been introduced: - Mechanism A allows for a designated allocation based on oversubscription multiples, with maximum allocation percentages of 5%, 15%, 25%, and 35% for different oversubscription levels [2]. - Mechanism B allows issuers to pre-select an allocation percentage between 10% and 60%, with no reallocation mechanism [3]. Initial Public Holding and Free Float Requirements - New initial public holding and free float requirements have been established, ensuring sufficient tradable shares at the time of listing [4][5]. - The minimum public holding threshold varies based on market capitalization, with specific requirements for different categories of issuers [5]. Continuous Public Holding Consultation - Further consultation on continuous public holding requirements is underway, aiming to provide greater flexibility for issuers while protecting shareholder interests [6][7]. - The current and proposed continuous public holding requirements have been compared, indicating a shift towards more flexible thresholds [8][9].