Goldman Sachs: Hong Kong stock market expected to face over 2 trillion yuan unlock wave

Odaily Planet Daily News: Goldman Sachs states that as IPO lock-up periods gradually expire, the Hong Kong market may see approximately $274 billion (about HKD 2.13 trillion) in new share supply over the next 12 months, and strong stock demand is expected to absorb this inflow. Goldman Sachs' report points out that dual demand from passive index funds and southbound funds constitutes an important liquidity buffer, effectively alleviating selling pressure caused by the unlocking of restricted shares.

Historical experience shows that within 3 to 6 months after unlocking, stock prices usually experience a mild decline of 4% to 7%, with significant divergence in returns. Short-term performance after unlocking is mainly determined by the proportion of unlocked shares relative to total share capital, while medium-term returns are structurally driven by the proportion of freely tradable shares after unlocking and the stock's performance prior to unlocking. Companies with a high proportion of cornerstone holdings, especially domestic cornerstone investors, often face greater selling pressure after the lock-up period expires. (Jin10)