Di Yi Cai Jing·2025-12-02 06:25Core Viewpoint - The phenomenon of "AH share premium inversion" is observed in six companies, where H-shares are priced higher than A-shares, attributed to low liquidity and foreign investors' preference for industry leaders [1][2]. Group 1: Market Dynamics - The Heng Seng AH Share Premium Index (HSAHP) remains above 120, indicating a 20% premium of A-shares over H-shares [1]. - The six companies experiencing this inversion include CATL, China Merchants Bank, Hengrui Medicine, Weichai Power, WuXi AppTec, and Midea Group [2]. - The market sees a preference for newly listed stocks in the H-share market, which have lower liquidity, leading to higher valuations [2]. Group 2: Liquidity and New Listings - The "inversion" stocks are characterized by a high proportion of newly listed shares, with three of the six companies listed for less than a year [2]. - The market capitalization of H-shares is often significantly smaller than that of A-shares, contributing to the liquidity scarcity and price inversion [2]. - As institutional investors gradually exit their IPO allocations, the liquidity in the H-share market is expected to increase, potentially narrowing the premium [2]. Group 3: Foreign Investment Preferences - Foreign investors show a strong preference for industry leaders that have established market positions and stable financials [3][4]. - These companies typically operate in traditional sectors such as finance, energy, and infrastructure, which have predictable profit models [3]. - The preference for H-shares is also driven by the perception of higher growth potential and better governance structures in these companies [4]. Group 4: Examples of Inversion - BYD and China Merchants Bank are highlighted as typical examples of companies where H-shares occasionally exhibit a premium over A-shares [5]. - The presence of monopolistic characteristics in H-shares can attract foreign investment, as these companies are often seen as irreplaceable in the global market [5].