Morton Securities' Leung Kit-man: Hong Kong Main Board company "shell prices" have fallen to HK$100-200 million, making shell purchases attractive.

Morton Securities director Leung Kit-man said that trading in "shells" has been active for two to three years since the pandemic, with activity consistently at a high level, but listed "shell prices" have not risen. For example, Main Board company "shell prices" once commanded HK$400-500 million before the pandemic, or even as high as HK$700 million, but now stand at only about HK$100-200 million; GEM board company "shell prices" are also only in the tens of millions of Hong Kong dollars, remaining at a low level. Leung Kit-man believes that lower shell prices are relatively attractive to those intending to buy shells, and expects demand for shell purchases to continue. As for shell buyers encountering price increases, this has not been seen much, because before the pandemic the market had a large supply of new shares, making it difficult to raise prices substantially given the many choices available. Data shows that as early as May 2020, Leung Kit-man, then an investment manager at Morton Securities, predicted in a media interview that in the long run, Main Board "shell prices" would fall to HK$100-200 million.