To judge by the article, this is a fresh idea that is still at the initial stage of evaluation. The proposal is a creative way of introducing additional incentives for companies to choose the local market for their primary listings. That said, we think that the current DR limits have been proven to be, at best, irrelevant for the stated objective of enhancing the role of the local exchanges and, at worst, an impediment to developing the local market, fragmenting liquidity and distorting the cost of capital for companies where such limits have now become binding.
This initiative confirms that the policy stance on DR limits is geared towards removing them. That said, we would only see this as good news so long as half-measures do not delay the comprehensive lifting of the limits (for both new listings and existing ones). Updated guidance from the regulator on the timing for reaching that goal would be most appreciated.