Hong Kong allowing listing applicants more privacy sparks wave of confidential filings
The Hong Kong exchange's rule for U.S.-style confidential filings, which allows certain companies to keep their business plans and financials under wraps in the initial stages of their stock market debut process, was implemented in May.
Chinese companies, including autonomous driving firm Zelos Tech and artificial intelligence (AI) startup MiniMax, have filed confidentially in recent months to get themselves listed in the city, according to separate sources.
Most filings followed the launch of the Technology Enterprises Channel (TECH) in May, allowing certain niche biotech and technology firms, including AI companies, to apply privately.
Confidential filings appeal to sectors such as AI and semiconductors that are deemed sensitive due to heightened macroeconomic and geopolitical risks, advisers say. The mechanism allows firms to navigate the regulatory review process without public disclosure, offering flexibility when IPO timelines are uncertain, according to several senior bankers at global and Chinese investment banks.
Previously, without getting exemptions from the Hong Kong exchange, only firms already listed on another major overseas bourse could lodge draft prospectuses confidentially ahead of launching a share sale in the Asian financial hub.
The new filing mechanism is set to bolster Hong Kong as a preferred fundraising venue mainly for Chinese companies amid fierce competition with other major listing venues, notably New York, where confidential filings have been allowed for years.
A record number of Chinese companies are seeking a U.S. listing this year, braving volatile Sino-U.S. relations and U.S. calls for strict oversight of Chinese firms, Reuters reported last week.
Still, Hong Kong has been propelled by the influx of Chinese companies to the global top spot by listing volume of initial and second listings so far this year, overtaking its biggest rival, New York Stock Exchange, according to data from LSEG.
The listing momentum is set to continue with more than 190 listing applications - approximately 45 per cent in technology and 20 per cent in healthcare, according to the exchange operator Hong Kong Exchanges and Clearing Ltd (HKEX).
U.S.-listed robotaxi companies Pony AI and WeRide have also submitted confidential filings for their second listings in Hong Kong earlier this year, two sources with knowledge of the matter said.
The sources declined to be named as they were not authorised to speak to the media.
MiniMax, Pony AI and WeRide declined to comment. Zelos did not respond to Reuters' request for comment.
HKEX declined to comment for this story or on the total number of confidential applications.
REGULATORY REVIEW
Other companies not covered under the newly-launched TECH initiative can request a waiver from the Hong Kong exchange to keep their listing applications private, according to capital markets bankers and lawyers.
Fast-fashion retailer Shein, for example, lodged its filing for a Hong Kong IPO confidentially last month, in the most high-profile such case so far, according to two separate sources with direct knowledge of the matter. Shein did not respond to a request for comment.
Confidential filings are advantageous in the innovation-driven economy.
Biotech companies are particularly cautious about releasing information on their projects and research and development plans due to intense competition in the sector, according to Jean Thio, a Clifford Chance capital markets partner.
"These companies have valuable IP that's being developed and they're trying to monetise that," Thio said.
"If you were to put all that information out at such an early stage, there are worries that you could be leaking confidential trade secrets which your competitors could use against you."
A typical IPO process in Hong Kong generally takes at least six months from filing preliminary documents to launching the book, bankers and lawyers said.
"The market just shifts overnight with geopolitical or just tariff news. No one wants to be in the headline of an IPO flop after they file," said a Chinese company executive who held discussions about filing confidentially for a Hong Kong IPO.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
CNA
an hour ago
- CNA
Simba's acquisition of M1 may drive down mobile plan prices, analysts say
SINGAPORE: Mobile plan prices in Singapore could fall following Simba Telecoms' proposed acquisition of M1 Limited, as rival telcos adapt to the company's disruptive pricing strategy, analysts said. Known for its affordable mobile plans with large data bundles, Simba is expected to push the local telco industry into a new phase of competition, especially as it leverages M1's nationwide infrastructure to strengthen its own network coverage. On Monday (Aug 11), asset manager Keppel announced plans to sell M1 to Simba, with the transaction expected to be completed within months, pending approval from the Infocomm Media Development Authority (IMDA). "For retail customers, this acquisition is good news because Simba is known for its low-cost, high-data mobile offerings," said Ms Shirley Tee, deputy director for industry and innovation at Nanyang Polytechnic's School of Business Management. "This will likely pressure other telcos to either lower their prices or improve their own service bundles to remain competitive." She added that the new entity could introduce novel billing approaches such as usage-based pricing or AI-personalised plans. Enterprise customers, such as large firms and organisations, may also benefit from more competitive pricing and attractive bundled offerings across mobile, broadband and information and communication technology (ICT) services, Ms Tee said. Professor Lawrence Loh from the National University of Singapore Business School said the move signals growing consolidation in the telecoms sector. 'Disruptive pricing plans and agile asset-light strategies may be the way forward for market players to survive and thrive,' he said. He noted the development mirrors global trends where legacy providers are challenged by digital-first entrants. Tech industry observer Oo Gin Lee said bills may fall if Simba extends its 'no frills, cheap access services' to M1's customer base. A tiered system could also be introduced, offering premium services to legacy M1 customers while retaining Simba's low-cost model for existing users. Still, Ms Tee cautioned that fewer players in the market could eventually reduce pricing diversity if not properly regulated. BETTER CONNECTIVITY AND CAPACITY The acquisition would allow Simba to tap M1's physical infrastructure – such as base stations and cell towers – to strengthen signal strength islandwide. Founded in 1994, M1 has an advanced telecommunications network. Simba, the youngest of Singapore's four fully licensed mobile network operators, holds full 4G and 5G spectrum rights. Prof Loh said the combined strengths of both entities would enhance customer offerings. 'M1 has the technology advantage with its advanced network while Simba has emerged as an innovative consumer service provider,' he said. 'The transfer will allow the M1 to scale in a focused way in the telecoms industry.' Mr Oo added that while it is unclear if spectrum rights are part of the deal, Simba is likely to gain from M1's existing physical infrastructure, such as base stations and cell towers, to improve its signal strength. DISRUPTING THE TELCO LANDSCAPE The deal is the latest example of how Simba has been 'a disruptive force' since it entered the scene as Singapore's fourth telco, said Mr Oo. 'At that time, Simba's pending arrival already shook up the market as the incumbents Singtel, StarHub and M1 started working with MVNOs (mobile virtual network operators), like to persuade IDA (Infocomm Development Authority of Singapore) that a fourth telco was not necessary for competition,' he said. Upon its launch, Simba made waves with S$10 per month plans. Its acquisition of M1, one of the original 'big three' telcos, marks a full-circle moment, he said. However, observers said the larger and more established telcos still have a role to play – provided they adapt to changing consumer expectations. 'Simba has a strong digital-first consumer model and creative marketing strategy, and may have captured the Singapore market share with their unique marketing and product offerings,' said Ms Tee. 'Established, legacy brands like M1 do still have a crucial role in today's telecoms landscape, but they must evolve.' They can no longer rely solely on providing landline, cell phone and network capabilities, but must instead pivot and become 'comprehensive digital service providers' to remain relevant, she said. To compete with the more nimble, digital-native brands, the older brands must also invest heavily to accelerate 5G and digital infrastructure, enhance their cybersecurity and AI capabilities, and significantly improve service quality, added Ms Tee. Prof Loh said M1's brand may eventually be integrated under Simba's umbrella. 'Staying cool and chic will be the key determinant of a brand's success in the telecoms industry,' he said.
CNA
an hour ago
- CNA
What's behind Malaysia's vow to better ‘confront threats' in South China Sea under 5-year development plan?
KUALA LUMPUR: The 13th Malaysia Plan outlining the country's latest five-year development includes the usual goals of economic growth, among others, but it is what Prime Minister Anwar Ibrahim said about defence and security that has caught observers by surprise. Particularly striking was how he singled out where the focus of military deterrence efforts would be. "Readiness to confront sovereignty and security threats in the South China Sea will be intensified more comprehensively," he said when tabling the development roadmap in parliament on Jul 31. While the 12th Malaysia Plan - tabled by then-Prime Minister Ismail Sabri Yaakob in 2021 - spoke about improving defence capabilities in general terms, the mention of the disputed and resource-rich waterway in the newest edition of the roadmap could bring deeper meaning, analysts told CNA. The Malaysian government could allocate specific budgets for more effective monitoring of its offshore resource areas, while the military aims to do more with less to counter threats in the strategic sea, possibly by buying more unmanned aerial vehicles (UAV), the experts added. 'The 13th Malaysia Plan is basically a strategic economic plan, but I was surprised the issue of sovereignty was included,' said Abdul Rahman Yaacob, a research fellow in the Southeast Asia programme at the Lowy Institute think tank in Australia. 'But Malaysian concerns over the South China Sea are not surprising. It has been building up its military capabilities in East Malaysia.' Putrajaya is in the midst of adding long-range radars, long-endurance drones and a new naval base in Sarawak expected to be capable of launching submarines to boost its security posture in the South China Sea. The unusual reference to the sea in such a significant national document could have come in the face of sustained pressure by China's naval forces and illegal fishing by Vietnamese vessels in Malaysia's Exclusive Economic Zones (EEZ) off its Borneo states and peninsular east coast, the observers said. But even with this new focus, the experts do not expect a change in Malaysia's long-adopted non-confrontational stance on South China Sea disputes, saying that Putrajaya will continue to prioritise strong bilateral ties with claimant states for mutual economic benefit. While China claims much of the South China Sea, other Association of Southeast Asian Nations (ASEAN) states that have laid a claim to the important waterway include Brunei, the Philippines and Vietnam. Thomas Daniel, director of foreign policy and security studies programme at Malaysia's Institute of Strategic & International Studies (ISIS) think tank, told CNA that while China is a 'big factor' behind Malaysia's move to include the South China Sea as part of its five-year development roadmap, it is not the only reason for it. "China is the one player in the South China Sea with the ability to change the status quo. And Malaysia, over the years, has been facing very steady pressure from the PRC," he told CNA, referring to the People's Republic of China. 'Another major challenge for Malaysia is actually illegal, unreported and unregulated fishing by Vietnamese fishing fleets. If you speak to Malaysian officials, this probably grates them more than the PRC.' Jamil Ghani, a doctoral candidate at Singapore's S Rajaratnam School of International Studies (RSIS), cited how such commercial fishing vessels have acted as means of human and wildlife trafficking between Malaysia and Vietnam. These factors, alongside China's grey-zone presence, overlapping claims, and pressure from Sabah and Sarawak leaders in Borneo, have "coalesced" to make maritime security a central pillar of Malaysia's national development strategy, he said. "It marks a shift from vague defence rhetoric to actionable policy.' SOUTH CHINA SEA THREATS Public tracking data from the Washington-based Asia Maritime Transparency Initiative showed that in 2024, the China Coast Guard patrolled the Luconia Shoals for 359 ship days, meaning a coast guard vessel was on station nearly every day, Jamil noted. Ship days refers to the number of days a specific ship or a group of ships is present in a particular area, used to track the intensity and duration of maritime patrols. Malaysia's EEZ comprises areas abundant in oil and gas that it says contribute almost 25 per cent to its gross domestic product (GDP). These include the Luconia Shoals, a group of mostly submerged reefs that lie between various Malaysian oil and gas sites 155km off the coast of Sarawak. China, which claims most of the South China Sea within its so-called nine-dash line, has regularly protested Malaysia's activities in the Luconia Shoals. Malaysia has said it will continue exploratory activities in its sovereign waters. China Coast Guard vessels at Luconia also made frequent visits to Malaysia's new exploratory wells drilled off Sarawak, approaching within 1km of several oil and gas platforms, Jamil said. This represented China's 'sustained grey‑zone pressure over both sovereignty and energy infrastructure', he said, using a term that describes coercive actions which fall below the threshold of conventional warfare. On fishing encroachments, ISIS' Daniel said Vietnamese boats were fishing illegally in Malaysian waters because fish stocks closer to home have dwindled due to pressure from Vietnam's large-scale fishing industry. 'Our fishing is minuscule compared to them, and our waters are not patrolled because there are no assets; there's no maritime domain awareness,' Daniel said. 'And when Malaysian coast guard vessels move to interdict, there are problems sometimes. Vietnamese fishermen have been known to be very aggressive. Some of them are armed. There have been shots fired.' Between mid-2019 and September 2024, the Malaysian Maritime Enforcement Agency (MMEA) detained 598 fishing vessels, three-quarters of which were Vietnamese, Jamil said. 'Adding a more insidious security dimension, a January 2025 study … revealed that commercial fishing vessels have become conduits for smuggling endangered animal parts and human trafficking between Malaysia and Vietnam,' he said. The study - conducted by wild cat conservation organisation Panthera, Sunway University's Jeffrey Sachs Center, and the Zoological Society of London - found that deepening economic vulnerabilities in the fisheries sector were fuelling convergence between illegal, unreported and unregulated fishing, wildlife crime and forced labour networks. Moving forward, it would make sense for Malaysia to buy assets that could detect and share information about incursions with other ground, air and naval units, Daniel said. 'What does it mean? Hopefully acquiring more naval and air assets, manned and unmanned, that are able to talk to each other and increase our awareness and our capacity to respond,' he said. Collin Koh, a senior fellow at RSIS' Institute of Defence and Strategic Studies, acknowledged that Malaysia faces a range of security challenges across its vast maritime zone. But he believes Chinese pressure in the disputed waterway off Borneo 'is by far the most intractable by comparison'. Ramping up Malaysia's security posture in the South China Sea would symbolise the Anwar administration's fulfilment of its obligations towards the two Borneo states, amid their push for greater autonomy including in energy revenue, Koh said. 'There's certainly the inescapable geo-economic dimension to it, and that has a lot to do with Malaysia's offshore energy interests in its Borneo EEZs,' he added. DRONES, RADARS AND JETS A stronger commitment to protect these interests means the Malaysian government could try to do more with less in terms of military assets, Daniel said. Malaysia's military has faced well-documented procurement, maintenance and obsolescence issues, even as Putrajaya aims to raise defence spending from the current 1.1 per cent to 1.5 per cent of its GDP by 2030. In 2024, the defence budgets of Southeast Asian countries ranged between 0.78 per cent (Indonesia) and 4.09 per cent (Myanmar) of their respective GDP. Koh noted that in 2021, Malaysia could scramble only its old Hawk fighter jets to intercept Chinese combat aircraft flying towards Malaysian airspace off Sabah. 'Overall, the strategic orientation of the Malaysian Armed Forces (MAF) build-up appears to be in no small part geared towards the South China Sea, besides the pragmatic consideration about growing obsolescence across the armed forces' array of equipment,' he said. Malaysia has agreed to buy an additional two long-range radars from France to deploy both on the peninsula and in East Malaysia, and is set to receive three Turkish-made long-endurance drones by March 2026. The drones will be based at Labuan Air Base in Borneo and provide sustained intelligence, surveillance and reconnaissance over Malaysia's EEZ, Jamil said. In May, Defence Minister Khaled Nordin pledged more investments in UAV technology. Malaysia is also finalising the purchase of up to 33 used F/A-18C/D Hornet fighter jets from Kuwait, although Daniel noted they would need to be upgraded to be on par with the Royal Malaysian Air Force's fleet of eight F/A-18D Hornets. 'The choice of second-hand Hornets from Kuwait isn't just to do with stock availability and operational familiarity, but also the fact that the jet is designed and optimised for overwater operations,' Koh said. It is not yet clear where the used Hornets - slated for delivery between late 2025 and 2026 - will be based. 'If deployed to East Malaysia, the Hornets would complement the new naval infrastructure in Sarawak and enable more persistent air coverage over offshore resource zones,' Jamil said. BEYOND HARDWARE Still, Malaysia will look 'beyond just hardware and software capability buildup', Koh said, pointing to its plan to build a new naval base in Muara Tebas, near the Sarawak capital of Kuching. The site offers 'rapid access to the open sea' and its suitably deep waters mean it could serve as a forward transit point for Malaysia's Scorpene-class submarines, improving maritime domain awareness in the South China Sea, Jamil said. The Sarawak Economic Development Corporation is conducting a feasibility study that is expected to conclude by the first quarter of 2026, with construction potentially starting soon after. The base, listed as a priority project under the 13th Malaysia Plan, was initially planned for construction further east in Bintulu closer to the EEZ, but was relocated over 500km away to Muara Tebas due to 'various factors', local media reported. It is not just about the navy. In his 13th Malaysia Plan speech, Anwar vowed to build an "integrated, agile and focused future force" to ensure the country's stability and prosperity. 'There's also in recent years growing inter-agency cooperation between MAF, especially the Royal Malaysian Navy, and MMEA to enhance joint response to maritime contingency,' Koh said, drawing comparisons to how China uses both its navy and coast guard to 'assert physical dominance' in the South China Sea. Anwar's statement reflects a thinking among Malaysian defence planners that the MAF, given its limited size and budget, needs to spend 'wisely', Daniel said. 'I think what you will see is, in long-term development plans especially on defence, more specific allocations for increasing capabilities that would allow Malaysia to sustain a presence for a longer period of time in disputed areas,' he said. 'It takes not just focused planning from defence planners, but also the political buy-in and the buy-in of the people who hold the purse strings - the Ministry of Finance. They need to ensure that this plan is not deviated by other national interests.' HEDGING HERE TO STAY Analysts, however, agree it is firmly in Malaysia's national interests to maintain its current diplomatic approach to South China Sea disputes. 'Malaysia has always had a very consistent approach to the South China Sea - segmentise this dispute and not allow it to interfere with other other aspects of its bilateral relations,' said ISIS' Daniel. 'Whether it's (due to) China or not, it is generally a good idea for the government to seriously devote some thinking and resources into long-term developments of the navy and air force.' Jamil from RSIS believes Malaysia is likely to maintain its China-friendly, non-confrontational diplomatic stance even as it strengthens its defence posture in the South China Sea. 'Rather than adopting overt assertiveness, Malaysia is pursuing a quiet deterrence-by-denial strategy, allowing it to raise the operational costs of incursions without escalating tensions,' he said. 'At the bilateral level, it will continue framing China as a strategic partner, opting for protest notes and legal reaffirmations over public confrontations.' Meanwhile, Malaysia is expected to become more active multilaterally, using ASEAN platforms to push for an enforceable code of conduct for the South China Sea, Jamil said.
CNA
an hour ago
- CNA
Trump signals possible sale of scaled-down Nvidia Blackwell AI chips to China
WASHINGTON: US President Donald Trump said on Monday (Aug 11) he may allow Nvidia to sell a reduced-performance version of its next-generation Blackwell artificial intelligence chip to China, despite longstanding concerns in Washington over Beijing's access to advanced US computing power. The move could allow China to secure more powerful AI capabilities even as the US and China compete for dominance in high-tech sectors. 'Jensen (Huang, Nvidia CEO) also has the new chip, the Blackwell. A somewhat enhanced-in-a-negative-way Blackwell. In other words, take 30% to 50% off of it,' Trump told reporters, suggesting the chip's computing power could be curtailed. 'I think he's coming to see me again about that, but that will be an unenhanced version of the big one,' he added. REVENUE-SHARING DEAL WITH US GOVERNMENT Earlier, the Trump administration confirmed an unprecedented deal under which Nvidia and AMD will give the US government 15 per cent of revenue from some AI chip sales to China. Trump defended the agreement, saying it followed the administration's decision last month to allow exports of Nvidia's less advanced H20 AI chips to China. 'The H20 is obsolete,' Trump said. 'So I said, 'Listen, I want 20% if I'm going to approve this for you, for the country.'' A US official said the Commerce Department has begun issuing licences for H20 chip sales and did not believe the exports compromised national security. SECURITY AND COMPETITION CONCERNS Critics, however, warned that even downgraded AI chips could help Beijing rapidly scale its computing capabilities. 'Even with scaled-down versions of flagship Nvidia (chips), China could spend and buy enough of them to build world-leading, frontier-scale AI supercomputers,' said Saif Khan, former director of Technology and National Security at the White House National Security Council under former president Joe Biden. Nvidia said it follows US government rules for global markets. 'While we haven't shipped H20 to China for months, we hope export control rules will let America compete in China and worldwide,' a company spokesperson said. AMD said the US had approved some exports of its AI processors to China and that the company complies with all export controls. CHINA RESPONDS China's foreign ministry has previously accused Washington of using technology and trade measures to 'maliciously contain and suppress China'.
