Increasing presence in the US market: Astrazeneca PLC Sponsored ADR (AZN.US) listing on the New York Stock Exchange, London position may be weakened.

The stock of Britain's largest pharmaceutical company Astrazeneca PLC Sponsored ADR (AZN.US) will begin trading on the New York Stock Exchange on Monday. The company recently underwent a listing upgrade to replace its American depositary receipts (ADRs) previously traded on the NASDAQ. Astrazeneca PLC Sponsored ADR will now be listed on the London Stock Exchange, the Stockholm Nasdaq, and the New York Stock Exchange simultaneously. The vaccine and drug manufacturer is seeking to attract more investors by further leaning towards the US market, as currently almost half of its revenue comes from the US. The company stated that this move will give it equal standing in the UK, Sweden, and the US markets. This reflects the growing importance of the US market to Astrazeneca PLC Sponsored ADR's business and the shift in focus as CEO Pascal Soriot seeks growth in the world's largest pharmaceutical market. Following this, US investors will find it easier to purchase Astrazeneca PLC Sponsored ADR's full shares, possibly reducing the relevance of its listing in London. Under pressure from President Trump's tariff plan, Astrazeneca PLC Sponsored ADR has committed to investing $50 billion in the US by 2030. Meanwhile, the company has paused its 200 million expansion plans for its UK headquarters. Peel Hunt's research director Charles Hall believes that the long-term risk lies in the stock trading mainly moving to the US. In a report in October, he stated, "Assuming a significant increase in US liquidity, and with the majority of shares held by international investors, we believe over time the company is highly likely to consider relocating its primary listing from London to the US." This move will also allow investors to purchase Astrazeneca PLC Sponsored ADR shares without having to pay stamp duty (a UK trading tax). Peel Hunt's report indicates that this could result in a 2 billion loss in revenue for the UK Treasury annually. If successful, this may encourage other London-listed companies to convert their ADRs to ordinary shares, further reducing stamp duty tax revenue. In recent years, trading volume of British companies' ADRs in the US has surged. Data shows that between 2019 and 2024, the trading volume of 20 FTSE 100 companies with listed ADRs increased by over 80%. The trading volume of Astrazeneca PLC Sponsored ADR's ADRs grew by 34% in the five years leading up to 2024, while during the same period, trading volume on the London Stock Exchange increased by less than 8%. Several other well-known British companies saw significant growth in their ADR trading volumes: Barclays PLC Sponsored ADR tripled, Diageo plc Sponsored ADR, British American Tobacco Plc, and GlaxoSmithKline plc Sponsored ADR all more than doubled. For a long time, the UK has struggled to compete with the US market, which is larger, more liquid, and home to many high-growth companies, while the UK market is dominated by lower-valued traditional sectors. Although the UK stock market is at historic highs, its performance still lags behind the US. This discrepancy has become more pronounced since the onset of the COVID-19 pandemic: since the beginning of 2020, the FTSE 100 Index has risen by about 40% in dollars, far below the 115% increase in the Standard & Poor's 500 Index.