Zheng Quan Shi Bao·2025-08-01 23:53Core Viewpoint - Hong Kong Exchanges and Clearing Limited (HKEX) is optimizing its initial public offering (IPO) pricing and public market regulations to enhance competitiveness and attract a diverse range of international investors [2][3]. IPO Pricing and Public Market Reform Summary - The Hong Kong Stock Exchange (HKEX) received 1,253 unique responses to its consultation document, leading to the adoption of most suggestions with slight revisions [2]. - The minimum allocation for the book-building portion of IPOs has been reduced from 50% to 40% of the initially proposed shares [2]. - Two mechanisms for allocation to the public subscription portion have been introduced: - Mechanism A replaces the existing allocation and replenishment mechanism with a specified allocation ratio based on oversubscription multiples, allowing a maximum reallocation percentage increase from 20% to 35% [2][3]. - Mechanism B introduces a new option where issuers can pre-select a public subscription allocation ratio between 10% and 60%, with no replenishment mechanism [2]. - The existing cornerstone investor six-month lock-up period will remain unchanged, and the proposed increase in pricing flexibility will not be implemented [2]. Initial Public Holding and Free Float Requirements - New minimum public holding and free float requirements have been established for issuers at the time of listing, with specific thresholds based on market capitalization [3][4]. - The new regulations will take effect on August 4, 2025, and will apply to all issuers and new listing applicants [3][4]. Continuous Public Holding Consultation - HKEX is conducting further consultations on continuous public holding requirements, aiming to provide issuers with greater flexibility while ensuring shareholder protection [6][7]. - The current and proposed continuous public holding requirements have been compared, with new thresholds introduced for different types of issuers [7][8]. - The public consultation period for these proposals will end on October 1, 2025 [8].