A Study On The Motivation And Performance Of Alibaba’s Secondary Listing

The return of red-chip Enterprises has been a matter of great concern in China’s capital market.In addition to the increasing tension between China and the United States in recent years and the strengthening of market supervision in the United States,the situation of red-chip enterprises in the United States is even more difficult.In response to this phenomenon,the Chinese government and various securities markets have introduced preferential policies and regulations for red-chip enterprises to return to the domestic market,of which the secondary listing mode proposed by the Hong Kong Stock Exchange is the most novel,the Way of returning to Hong Kong for the second time has aroused the attention of many red-chip enterprises,so it is very important to study and analyze the model of returning to Hong Kong for the second time,which can accelerate the return of red-chip enterprises.The methods used in this paper are:in this paper,the Alibaba Group,which is the first to rejoin the Hong Kong stock exchange by way of secondary listing,is taken as the research object.Firstly,based on the signal transmission theory,the market segmentation theory and the investor cognition hypothesis,focus on the process of the return of the red-chip Enterprises,and then take the whole event of Alibaba’s second listing back to the Hong Kong stock exchange as the starting point,specifically analyze the motivation of this return;Then,the financial performance after the second regression is analyzed by using factor analysis method and financial index comparison method respectively,and the non-financial performance brought by the second regression is reflected through market reaction,stock attraction and enterprise strategy,finally,according to the problems and conclusions found,the author puts forward relevant suggestions to the case companies,other red-chip enterprises eager to return,and the stock exchange,with a view to helping other red-chip enterprises to better solve the future return problems: such as the choice of return location,return mode,improve the rate of return to the domestic capital market,measures to deal with the risk of delisting brought by environmental change.To sum up,the final findings of this paper are as follows: the change of external capital market is the fundamental motivation of Alibaba’s re-listing in Hong Kong,among them,the tension between China and the United States,the introduction of U.S.trade sanctions policy,the escalation of cross-border audit conflicts are negative incentives;The mature capital market and geographical advantage of Hong Kong as well as the innovation of the secondary listing system of Hong Kong are positive incentives;The company’s own financing,improved investor perception and the need for funds for strategic transformation are also important factors driving Alibaba’s return.In terms of financial performance,Alibaba’s secondary listing has improved its short-term market value and profitability.Cash flow from equity financing has helped companies improve their short-term solvency,but the positive reaction can not last,even regression leads to a decline in development capacity;the market reaction in non-financial performance,like it,starts with a sustained increase in positive investor attitudes followed by a weakening of the ability to sustain steady growth.The appeal of the stock and the sustainability of the strategic impetus are stronger.Therefore,the conclusion of this paper is that the positive effect of secondary listing on the performance of Alibaba is not sustainable,and it should be rational to look at the value changes brought about by this return,and continue to focus on improving their core competitiveness.Alibaba’s secondary listing back to the form of the Hong Kong stock exchange may not be suitable for all red-chip enterprises,other enterprises should be rational,reasonable choice for their own way of return.