China Southern Air Holding, parent company of Hong Kong-listed China Southern Airlines, wants to undertake a share reform program that will allow its nontradable shares to be traded on the mainland China's stock market.

The parent company said in a statement to the Hong Kong Stock Exchange on March 23 that it is proposing reforming its share structure, but did not disclose any plan to compensate shareholders, only that details would be announced before April 9.

China Southern Air is one of the few A-share listed companies that has not completed its share reform.

The company may offer a put option, or promise to buy shares at a fixed price in the future, to meet the requirement, as it cannot cut its stake without losing its controlling interest in the Guangzhou-based airline, market watchers said.

The parent, which owns 50.3 percent of the subsidiary, is prevented from lowering its stake as the aviation regulator's rules require it to maintain a controlling interest in what is the mainland's largest carrier by fleet size.

Analysts and fund managers expect the parent may follow the reform structure of China International Marine Containers, which is owned by COSCO Pacific and China Merchants Holding.

CIMC, the mainland's biggest overseas port operator, said in the past that it offered shareholders seven put options for every 10 CIMC A shares as it looked to bring to market the 16.23 percent holding in the container manufacturer that it owned in the form of nontradable shares.

"The airline's share price may climb above the put-option price, causing investors to retain their shares rather than forcing the parent to buy them," an analyst said.

He added that China Southern Air is lacking in cash due to high liabilities.

Shares of Hong Kong-listed China Southern Airlines ended the week at HK$3.75, a gain of 3.05 percent.

The share reform could mean the carrier is allowed to initiate fundraising activities in the capital markets, or to bring strategic investors on board.

However, analysts question the success of the proposed share reform.

"It is too early to translate the share reform to a positive impact on the carrier," said Karen Chan at Credit Suisse.

Meanwhile, the parent company halted trading of its Shanghai-listed stock on March 23 following a 5 percent gain to 7.43 yuan on March 22, extending its year-to-date rise to 82 percent.