The Exchange has published updates of Guidance Letters HKEx GL27-12 “Simplification Series – Guidance on disclosure in listing documents for IPO cases – the “Summary and Highlights” section” and GL41-12 “Guidance on disclosure requirements for IPO cases – Disclosure of material changes in financial, operational and/or trading position after trading record period”.   The amendments relate to the obligation to disclose of material adverse changes in the financial or trading position of the group since the end of the track record period. Under the amendments:

  • qualitative or quantitative disclosure with commentary on how the adverse changes affect the financial, operational and/or trading record period must be disclosed in the “Summary” section of the listing document;
  • such disclosure must  enable investors to have a sense of the materiality of the adverse changes;
  • disclosure of comparative financial information to non-profit forecast financial information disclosed is not compulsory. However, if an applicant chooses to disclose such information in its listing document, this should at least be reviewed by the applicant’s sponsor;
  • any material adverse changes must also be highlighted in the “Risk Factors” and “Financial Information” sections of listing documents; and
  • underwriting commissions must be included in the total amount of listing expenses relating to an offer as stated in the “Summary and Highlights” section.