(July 16): Baidu Inc plans to pursue a dual primary listing in the US and Hong Kong, a move that will allow it to tap mainland Chinese investors.
The artificial intelligence (AI) developer and internet search leader said it aims to upgrade its listing on the main board of Hong Kong’s stock exchange to primary status. Its US shares gained as much as 3.2% in pre-market trading.
Baidu is following in the footsteps of companies like NetEase Inc, whose shares have gained more than 15% since disclosing that intent in March. It’s a necessary step to gain access to the so-called Stock Connect programme that links the Hong Kong bourse with the Shanghai and Shenzhen exchanges, which will expand access to investors in mainland China.
Like much of the industry, the company seeks capital to bankroll AI development and compete with aggressive rivals from Alibaba Group Holding Ltd to DeepSeek. Baidu’s AI chip unit has hired banks for an initial public offering in Hong Kong that may raise as much as US$2 billion ($2.58 billion), according to people familiar with the matter.
Baidu currently 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. A primary listing would help Baidu qualify for cross-border trading, opening up investment flows from the mainland to Hong Kong.
Baidu’s move is intended in part also to protect itself from potentially unfavourable US policies, people familiar with the matter told Bloomberg News in January. Alibaba did a similar upgrade in 2024 after US-China tensions raised the threat of delisting in America.
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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.
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