Hong Kong Warrants Issuance: Key Features and Market Insights

Strategic Insights -

The Hongkong and Shanghai Banking Corporation Limited has issued warrants in five separate series, linked to major Hong Kong-listed companies. The warrants are trading under the stock codes 13986, 13993, 14006, 14030, and 14033, with liquidity provider and broker ID 9721 for all series. Key features of the warrants include European-style cash settlement, with the entitlement varying across series.

Key Takeaways:

  • **Issue size:** Each of the five series has an issue size of 80,000,000 warrants, making a total of 400,000,000 warrants issued.
  • **Linked companies:** The warrants are linked to major Hong Kong-listed companies, including Tencent Holdings Limited, NetEase, Inc., Hong Kong Exchanges and Clearing Limited, Ping An HealthCare and Technology Company Limited.
  • **Exercise prices:** The exercise prices for the warrants vary across series, ranging from HK$130.80 to HK$686.38.
  • **Average prices:** The average prices for the warrants are determined by the arithmetic mean of the closing prices of one share for each valuation date.
  • **Number of warrants per entitlement:** The number of warrants per entitlement also varies across series, ranging from 50 to 500 warrants per share.
  • **Launch and issue dates:** The launch date for all series is 10 February 2021, and the issue dates range from 16 February 2021 to 17 February 2021.
  • **Implied volatility:** The implied volatility for the warrants ranges from 36.89% to 57.70%.
  • **Effective gearing:** The effective gearing for the warrants ranges from 2.15x to 3.57x.

Statistics:

  • **Issue size:** 400,000,000 warrants issued.
  • **Linked companies:** Amazon, Tencent Holdings Limited, NetEase, Inc., Hong Kong Exchanges and Clearing Limited, Ping An HealthCare and Technology Company Limited.
  • **Exercise prices:** HK$130.80 to HK$686.38.
  • **Average prices:** Determined by the arithmetic mean of the closing prices of one share for each valuation date.
  • **Number of warrants per entitlement:** 50 to 500 warrants per share.
  • **Launch and issue dates:** 10 February 2021 to 17 February 2021.
  • **Implied volatility:** 36.89% to 57.70%.
  • **Effective gearing:** 2.15x to 3.57x.

Sources:

  • "Announcement relating to the issue of warrants" by The Hongkong and Shanghai Banking Corporation Limited.