Eliza Wong
Executive Summary
- Singapore Exchange (SGX) now permits secondary listings from Shanghai and Shenzhen Stock Exchanges, expanding beyond previous Hong Kong-only eligibility
- New pathway allows A-share companies to raise capital in Singapore dollars while maintaining primary listing obligations in China
- SGX offers tax incentives: 20% corporate tax rebate for secondary listings raising new capital
- Southeast Asian institutional investors and family offices represent key capital source for expanding Chinese companies
- Multiple Chinese securities firms already established SGX sponsorship capabilities to facilitate listings
New Gateway for Chinese Equities
The landscape for Chinese companies seeking international listings just expanded significantly. Following the recent “Shanghai-Singapore Cooperation Exchange Meeting” jointly hosted by Shanghai Stock Exchange (SSE) and Singapore Exchange (SGX), nearly 70 Shanghai-listed companies and financial institutions explored the new pathway for A-share companies listing on SGX through secondary listings. This development marks a strategic diversification opportunity for Chinese firms looking to access global capital markets.
Regulatory Breakthrough
Previously, SGX’s secondary listing framework only recognized Hong Kong Exchanges and Clearing Limited (HKEX) as eligible primary listing venues for Chinese companies. The recent change now explicitly includes companies listed on both Shanghai Stock Exchange (上海证券交易所) and Shenzhen Stock Exchange (深圳证券交易所). This regulatory shift creates a clear pathway for qualified SSE and SZSE-listed companies to raise capital through Singapore depository receipts (S-shares) while continuing to fulfill their A-share market obligations.
Ng Yao Loong (黄耀龙), SGX Group Executive Vice President and Head of Equities, confirmed: “SGX continues to optimize its secondary listing framework, which has been expanded to include enterprises listed on the Shanghai and Shenzhen stock exchanges. We provide clearer pathway choices in process transparency, time certainty, and investor reach, supporting companies in building more robust investor bases in global markets.”
Strategic Advantages for A-Share Companies
The new pathway for A-share companies listing on SGX offers multiple strategic benefits beyond simple capital raising. Companies can maintain their primary listing standards and accounting practices from their home exchange while accessing new investor demographics in Southeast Asia.
Reduced Regulatory Burden
Under SGX’s secondary listing framework, the exchange primarily references the rules of the primary listing venue for regulatory oversight. This means secondary listed companies can continue using their original listing location’s continuous listing rules and accounting standards, significantly reducing compliance complexity and costs. The streamlined process makes A-share companies listing on SGX particularly attractive for firms seeking international exposure without excessive regulatory overhead.
SGX Market Dynamics and Incentives
Singapore’s exchange has actively positioned itself to attract quality Chinese listings through both market improvements and policy incentives. The movement toward welcoming A-share companies listing on SGX aligns with broader initiatives to enhance Singapore’s capital market competitiveness.
Growing Market Liquidity
SGX’s market metrics show encouraging trends. For fiscal year 2025, SGX reported average daily equity turnover of S$1.34 billion, representing 26.5% year-over-year growth and reaching a four-year high. Total turnover reached S$336.4 billion, increasing 27.5% year-over-year. These liquidity improvements create a more attractive environment for A-share companies listing on SGX seeking meaningful capital raising capabilities.
Financial Incentives
SGX offers concrete financial benefits to encourage listings. Companies pursuing initial listings qualify for a 10% corporate income tax rebate, while those conducting secondary listings with new capital raising receive a 20% rebate. Additionally, SGX has intensified promotion of China-themed products including RMB-denominated instruments, iron ore products, and SGX FTSE China A50 Index futures, creating complementary products that support trading activity around A-share companies listing on SGX.
Southeast Asian Capital Access
The strategic value of A-share companies listing on SGX extends beyond the exchange itself to the broader Southeast Asian investor ecosystem. Singapore serves as Asia’s leading wealth management hub, with over S$6 trillion in assets under management, more than 2,000 single-family offices, and over 1,200 global funds investing in SGX-listed companies.
Regional Investor Base
For a exchange with just over 600 listed companies, these investor numbers represent substantial capital availability. Southeast Asian institutional investors and family offices particularly attract Chinese companies seeking to develop their regional presence. The capital raised in Singapore dollars or through equity issuance can serve as acquisition currency for regional mergers and acquisitions, enhancing Chinese brand influence throughout Southeast Asia.
As Ng Yao Loong (黄耀龙) noted: “As a major wealth management center in Asia, Singapore’s managed asset scale exceeds S$6 trillion, with more than 2,000 single-family offices and over 1,200 global funds investing in SGX-listed companies. For SGX, which has only 600-plus listed companies, these numbers are considerable and can fully support more Chinese enterprises listing and raising funds.”
Early Movers and Investment Banking Infrastructure
The pathway for A-share companies listing on SGX already shows promising early activity. Several Chinese companies have expressed interest, with some already engaging investment banks to explore possibilities.
Pioneering Examples
In July, CMS Pharma (0867.HK, 康哲药业) listed on SGX through introduction (without new share issuance), becoming the first Chinese pharmaceutical company to achieve secondary listing on SGX this year. The company specifically cited SGX’s Southeast Asian market position as strategic rationale. “We are extending the advantages accumulated in the Chinese market to the entire Asia-Pacific region, deepening our layout in Southeast Asia and the Middle East. This secondary listing can attract funds focused on Asia-Pacific investment and Southeast Asian local capital, providing more funding and credibility endorsement for subsequent mergers and acquisitions and pipeline expansion,” CMS Pharma stated.
Chinese Brokerage Preparation
Chinese securities firms have proactively established SGX capabilities to facilitate the trend of A-share companies listing on SGX. As early as 2018, China Galaxy Securities (601881.SH, 中国银河) entered the Southeast Asian market through acquisition of Galaxy-CIMB Securities International Pte Ltd, which subsequently handled SGX secondary listings for Helen’s International Holdings (HLS.SG, 海伦司) and CMS Pharma.
In April 2023, Soochow Securities (Singapore) obtained sponsorship qualifications for both SGX Mainboard and Catalist boards, becoming the only Chinese brokerage with Catalist sponsorship eligibility. During first-half 2024, Huatai Securities (601688.SH, 华泰证券) subsidiary Huatai Securities (Singapore) received SGX Mainboard sponsorship qualification, enabling it to undertake and manage mainboard IPO projects.
Strategic Implications and Future Outlook
The new pathway for A-share companies listing on SGX represents more than just another listing venue option. It signals deepening financial integration between China and Southeast Asia while providing Chinese companies with sophisticated capital access points for regional expansion.
Geopolitical Context
This development occurs alongside China’s broader Belt and Road Initiative and increasing economic integration with ASEAN nations. The ability for A-share companies listing on SGX to tap Southeast Asian capital aligns perfectly with China’s strategic economic objectives while providing companies with diversified funding sources amid evolving US-China financial decoupling trends.
Future Projections
Market participants anticipate growing interest among A-share companies considering SGX listings, particularly those with existing Southeast Asian operations or expansion plans. Companies in technology, renewable energy, consumer goods, and infrastructure development appear particularly well-positioned to benefit from this new pathway for A-share companies listing on SGX.
Navigating the New Pathway
The emergence of SGX as a viable secondary listing destination for A-share companies creates compelling opportunities for Chinese firms seeking international capital while maintaining domestic listings. The combination of regulatory simplicity, financial incentives, and access to Southeast Asian capital makes A-share companies listing on SGX an attractive strategic option.
Companies considering this pathway should engage experienced advisors familiar with both Chinese regulatory requirements and SGX listing standards. The established presence of Chinese securities firms in Singapore provides ready access to appropriate expertise. As China-Southeast Asia economic relations continue deepening, the trend of A-share companies listing on SGX will likely accelerate, creating new capital market connections between the world’s second-largest economy and one of its fastest-growing regions.
Financial professionals monitoring Chinese equity markets should track early movers in this space as indicators of broader adoption patterns. The success of pioneering A-share companies listing on SGX will likely influence regulatory developments and market receptivity, potentially creating blueprint for other Chinese companies considering similar international expansion through capital markets.
