Baidu is said to explore upgrading HK listing to primary status

[HONG KONG] Baidu is considering upgrading its Hong Kong listing to primary status, to gain more exposure to investors in mainland China and protect itself from potentially unfavourable US policies, said sources.

The technology company – with a market value of US$52 billion – trades on the Nasdaq and has a second listing in Hong Kong.

That makes it more accessible to investors in Asia, but not in mainland China because it is still not eligible for the so-called stock connect.

A primary listing would help Baidu qualify for cross-border trading, opening up investment flows from the mainland to Hong Kong. 

Deliberations have gathered momentum with Baidu’s plan to list Kunlunxin, a unit that makes chips to power data centres and artificial intelligence (AI) applications, the sources added.

Upgrading the Hong Kong listing might offer a hedge against US sanction risk, given the political sensitivity of the sector, they said, asking not to be identified because the information is private. 

Alibaba Group did a similar upgrade in 2024, after US-China tensions raised the threat of delisting in America. 

Hong Kong’s stock market has been a bright spot. The Hang Seng Index has risen 40 per cent in the past year, and companies are flocking in to raise billions of dollars in share sales.

AI chip designer Shanghai Biren Technology has soared nearly 100 per cent in the two weeks since its listing in the city. 

Dual-primary listings, like the one Baidu is considering, have stricter reporting requirements, as well as more administrative and other expenses. Mainland China-based companies also need to meet criteria on weighted voting rights to qualify for the stock connect. 

A Baidu spokesperson did not respond to an e-mail seeking comment. 

Baidu’s American Depositary Receipts have climbed about 90 per cent over the past 12 months, outperforming the Nasdaq Golden Dragon China Index, which is up 21 per cent. BLOOMBERG