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Main Board & Growth Enterprise Market Comparison - HKSE
1. HKSE policies state that the Main Board companies must have a track record of at least three years (with exceptions in certain investment circumstances). In the case of new applicants to be listed under the "profit test", the new applicants must have recorded a profit of HK$20 million in the most recent financial year and an aggregate profit of HK$30 million in the two preceding financial years. In the other cases where new applicants are to be listed under "the market capitalization / revenue test" or the "market capitalization / revenue / cash flow test", the new applicants must comply with the alternative financial standards tests (including revenue requirement, such as the new applicants must be able to generate substantial revenues for the most recent audited financial year). GEM does not have a profit record or revenue or other financial standards requirements but companies must have had active business pursuits for the 24 months before listing application (a 12 months active business periods is acceptable for companies that can meet certain conditions of size and public shareholding).
2. There is no specific requirement for Main Board companies to have a focused line of business, but GEM companies must have a focused line of business.
3. The Main Board requires the business to be under substantially the same management throughout the three-year track record period (with some exceptions), but GEM companies are required to be under substantially the same management and ownership during the 24 months before listing application (or 12 months, see (i) above).
4. Requirement to have a sponsor ends once a company lists on the Main Board (However, an H-share issuer must retain a sponsor for at least one year after listing). GEM companies must appoint a sponsor as their adviser at least for two full financial years after listing.
5. Both Main Board and GEM companies are required to appoint at least three independent non-executive directors, and at least one of the independent non-executive directors must have appropriate professional qualifications or accounting or related financial management expertise. In addition, both Main Board and GEM companies are required to appoint a qualified accountant on a full time-basis and establish an audit committee. A GEM company must appoint a compliance officer.
6. The minimum public float of a Main Board company must be HK$50 million and 25 per cent of the issued share capital (this can be lowered to not less than 15 per cent at the discretion of the Stock Exchange if the issuer's market capitalization exceeds HK$10 billion). For GEM companies with a market capitalization not exceeding HK$4 billion, the minimum public float will be 25 per cent subject to a minimum of HK$30 million. For companies with a market capitalization exceeding HK$4 billion, the minimum public float will be the higher of HK$1 billion and 20 per cent of the issued share capital. Companies listed before 1 October 2001 are subject to the minimum prescribed percentage at the time of their listing, which is slightly different.
7. A Main Board company must issue its annual report at least 21 days before the date of its AGM and within four months after the end of the financial year. The company must also compile an interim report for the first six months of each financial year and distribute the interim report within three months after the interim period ends. After listing, GEM companies are required to publish their annual reports within three months after the financial year end date and the half-yearly reports and quarterly reports within 45 days after the end of each such period.
Source: HKSE
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