During its late Monday annual general meeting, Alibaba shareholders voted in favor of a stock split that could lower prices and hasten new share releases.
Industry experts believe the move was made at a time when its reported Hong Kong listing is more necessary than ever.
According to CNBC, analysts believe the overwhelming votes of approval are proof that Alibaba is looking to secure a Hong Kong listing even if it is already listed in New York. After all, there is a possibility the Chinese e-commerce giant will be unintentionally dragged into the trade war, experts said.
"I'd say there is a sense of urgency, the stock split appears to be a step in the direction of getting that Hong Kong listing," director of research at D.A. Davidson & Co., Gil Luria, suggested.
Luria further explained that instead of pushing the reported HK listing to the fourth quarter of this year, the move could be done earlier than expected. This is especially true now that there is an uncertain atmosphere wrapping the trade tensions between Beijing and Washington.
Aside from the probability that Alibaba is trying to escape U.S. tariffs due to its New York listing, the Chinese tech firm may be grabbing the opportunity of listing in familiar waters now that the Hong Kong Exchanges and Clearing lifted restrictions on dual-class stock structures.
Earlier reports suggested that Alibaba is looking to raise around $20 billion for its Hong Kong initial public offering (IPO). The company has yet to confirm its plan to list in home turf but industry analysts believe it will happen sooner than later.
Under the approved stock split, the online retail behemoth's ordinary stocks would be divided into eight. Ordinary shares are currently at four billion, which means these numbers will be expanded to 32 billion.
Aside from approving the proposed stock split, Alibaba also approved a number of other motions including the re-election of Chief Executive Officer (CEO) Daniel Zhang and three board directors namely: Wan Ling Martello, Jerry Yang, and Tung Chee-hwa.
When Alibaba filed for a New York listing in 2014, the company expressed disappointment over the Hong Kong stock exchange's restrictions. Vice-Chairman Joe Tsai said at that time that "the question Hong Kong must address is whether it is ready to look forward as the rest of the world passes it by."
In what could be a response to Tsai's sentiments, the stock exchange revamped its restrictions, paving the way for Alibaba to file for an IPO at home. Experts believe if it happens, the Chinese firm will have more chances of growing its investor base since it is more familiar with the investment behaviors of the finance sector in China.
