Top 10 U.S.-listed Chinese stocks by U.S. ownership
Traders are seen working on the New York Stock Exchange’s floor in New York City (USA), December 9, 2021.
Brendan McDermid | Reuters
BEIJING — The U.S.-listed Chinese stocks with the greatest share of American ownership don’t include many of the big names familiar to Wall Street, according to a Morgan Stanley report.
Washington and Beijing have been putting more pressure on Washington to increase their political influence more Chinese companies may need to delist from the U.S.You can also move to Hong Kong.
Morgan Stanley’s Dec. 9 report found that most stocks affected have very low U.S. ownership. Even those that have more American cash don’t contain well-known companies like Alibaba.
This is the full list.
CNBC calculated that the median U.S. holding for top 10 names is 43% according to Morgan Stanley data. These stocks are available for secondary listing in Hong Kong. Average ownership for all 50 top names is 27%.
Alibaba has a 13.1% lower rate than Chinese companies that make electric vehicles. NioAccording to the report, 20.4% is slightly less than it was previously reported.
In Hong Kong, Chinese companies including Baidu and Trip.com have offered secondary stock in the recent years. Investors can also swap U.S.-listed shares for Hong Kong stocks if they are removed from the market.
According to the Morgan Stanley report, other companies like Nio or video streaming site iQiyi are eligible immediately for launching a Hong Kong listing.
However, the report indicated that Hong Kong will be unable to list more than 40 U.S. listed Chinese stocks in the coming two years because they fail to meet market value, profit or other requirements of the exchange.
The U.S. owns the following stocks that have a market capital greater than $1B and are not eligible for listing in Hong Kong:
Chinese authorities have made it difficult for U.S. companies to list over the last few months. They require additional data security inspections.
Didi, the Chinese ride-hailing app was forced to terminate new user registrations days after its U.S.IPO in June. In a previous month the company said it would delist from the New York Stock ExchangeList in Hong Kong
Morgan Stanley did NOT include Didi in the report.
On the U.S.-side, there is increasing pressure on Chinese stock markets. This was the U.S. Securities and Exchange Commission at the beginning of this month finished the preliminary procedures necessary to begin a delisting process for Chinese stocks that don’t allow a U.S. government audit of three-straight years of financial reports.
Morgan Stanley analysts predict that forced delistings will not occur until at most 2024.
Changes like these will affect non-American investors and institutions more than American ones. The Morgan Stanley analysts estimate that U.S. retail investor only accounts for 13% U.S. trading volume on Chinese stocks.