The China Mobile delisting from the New York Stock Exchange was done due to the Trump-era decision to stop investment in Cino-tech companies. But, the company’s shares are on the rise after it started trading in Shangai.
The biggest public offering in China was done of around $7.7bn in a decade. China Mobile started 9.4% higher before coming back to normal in Shangai Stock Exchange.
China Mobile ( Hong Kong ) shares went up in early trading. This was done so, after the company announced to go ahead to buy back the 2.05 bn shares, having a $13bn worth estimate.
How many companies in China were delisted from the New York Stock Exchange?
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A total of three Chinese tech companies was delisted. These companies included China Telecom, China Unicom, and China Mobile. One of the big Chinese tech giants, Didi Global has already announced to delist from the NY stock exchange and enter into the Hong Kong Listings.
However, the company faced severe criticism because it collected $4.4bn in June from its US debut.
Plus, after a few days of NY public offerings, China conducted a major crackdown on Chinese companies listed abroad.
Due to the above scenario, Didi Global lost 65% of its share value since the US stock debut.
Is It good for both the countries?
For the United States, it will increase the opportunities for their own tech companies to innovate and replace China Mobile and other companies that are being delisted from the NY exchange.
However, for the Chinese side, it will alarm the bells for other major corporations that are working in the US. As Didi Global has shifted to Hong Kong Listings. Chinese may feel uncomfortable with this sort of decision by the USA administrations.
It is being reported in the economic world, that tussle between these two countries may prove dangerous for the people in the greater dimensions. That can be technological. Social, political, etc.
It is absolutely not good for the bilateral relationship of the countries. Socio-economic relationships are worsening. According to the BBC reporter Nina Xiang,
“ It is not beneficial for the Chinese companies to lose access to the USA market, as it will prove fatal for already worsened economic relations “
She also observed that other Chinese companies listed in the NY stock exchange may seek similar steps. They will secure their trading by listing in the Hong Kong market. This process may go on until both countries reach any working solution.
She said, the listing must go successfully of China Mobile in Hong Kong Stock Exchange, as it will prove the Chinese capacity to accommodate their companies when they are in trouble outside of their countries.
What are the plans of China Mobile Hong Kong?
The company plans to use the cash collected from the largest public offering in the following ways:
– Building premium 5G networks
– Investment in creating infrastructure for cloud resources/opportunities
– Innovating artificial intelligence software
China Mobile is the largest cellular network operator according to the total subscribers registered with it.