HONG Kong is known as a destination for spin-off listings. From 2018 to August 2022, 64 companies went public through spin-off listings on the domestic bourse, representing almost 10 per cent of initial public offerings (IPOs) in that period.

There continues to be buzz around such listings. For instance, Chinese Internet giant Alibaba Group last year announced plans to list its smart logistics arm Cainiao on the Hong Kong stock exchange, or HKEX, potentially raising US$1 billion. It was touted to be among the hottest Asian IPOs.

Alibaba has since indicated that it may put the listing on hold, citing market conditions. Nevertheless, it is worth learning more about the appeal of spin-off listings in Hong Kong, and what companies and investors should look out for.