Research On The Motivation And Effect Of J Company’s Return To Hong Kong Stock Market

With the rapid development of China’s economy in reform and opening-up,many enterprises are eager to go public for financing,and they have chosen to go public overseas,so "China Stock Exchange" came into being."China Stock Exchange" refers to the stocks issued by Chinese companies listed overseas.Most overseas listed companies have chosen the United States as their listing place.Therefore,this paper mainly studies China Stock Exchange listed in the United States.J Company belongs to the retail integrated e-commerce platform,which was listed on NASDAQ in 2014 and listed on Hong Kong stock in 2020.This paper will take J Company as the case object,mainly analyze the regression motivation and the regression effect,and try to summarize the experience that other enterprises should learn and follow.Firstly,this paper analyzes the motivation of J Company’s return to Hong Kong stocks.This paper mainly analyzes the motivation of J Company’s return to Hong Kong stocks from three aspects and seven small points.Policy: First of all,the trade war has a great influence.As the trade deficit between China and the United States has gradually increased since 2002,from trade friction to trade war,China Stock Exchange will naturally be affected by the tension between the two countries.Secondly,there is a delisting crisis in the United States:since the Southeast Rongtong incident in 2012,PCAOB has wanted to bring the auditing institutions of Chinese mainland companies and Hong Kong companies listed in the United States into the scope of supervision,but this involves multiple confidentiality issues,followed by excessive requirements for China Stock Exchange;Finally,it is the support of domestic policies: in 2018,Hong Kong’s capital market underwent institutional reform,allowing listed companies to go public for the second time,which is an excellent choice for qualified J companies.External motivation: firstly,the malicious short-selling of short-selling institutions: Chinese stocks are frequently short-selling by short-selling institutions,and when a Chinese stock is short-selling,the whole Chinese stock market will be fluctuated;Secondly,the market value is estimated to be low.When the value of an enterprise cannot be accurately reflected,it will seek new markets.Internal motivation: First of all,its own financing needs: Because J Company is in a high-speed development stage and wants to build a complete logistics network,warehouses,factories,equipment,etc.all need a lot of funds;Secondly,the company’s own development strategy: when returning to Hong Kong stock market,J Company mentioned that it might consider splitting one or more related businesses on the Hong Kong Stock Exchange within three years;Based on the above three reasons,this paper analyzes J Company’s return to Hong Kong stocks.This paper mainly analyzes the effect of regression from two aspects: the long-term and short-term market reaction;The short-term market reaction includes the reaction of US stocks and Hong Kong stocks;The long-term market reaction is mainly from four aspects:four capabilities and other financial effects.The short-term market reaction is measured by selecting the data in the window period to calculate the CAR value,while the long-term market reaction is measured by selecting financial indicators.Finally,through the analysis of the case of J Company’s return to Hong Kong stock market,it is found that no matter the enterprises in any industry,only when the enterprises themselves are in compliance can they have a long-term foothold in the industry.