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China Focus: IPO reform on ChiNext board boosts China's capital market

August 25, 2021


Abstract : Deemed the bellwether of the broader capital market revamp, China's registration-based initial public offerings (IPOs) system has spurred the capital market since it was expanded to the Nasdaq-style ChiNext board a year ago.

A man takes photos of a big screen displaying stock prices at the listing ceremony of the first batch of registration-based initial public offerings (IPOs) of enterprises debuted on the ChiNext board at Shenzhen Stock Exchange in Shenzhen, south China's Guangdong Province, Aug. 24, 2020. (Xinhua/Mao Siqian)

BEIJING, Aug. 24 (Xinhua) -- Deemed the bellwether of the broader capital market revamp, China's registration-based initial public offerings (IPOs) system has spurred the capital market since it was expanded to the Nasdaq-style ChiNext board a year ago.

On Aug. 24, 2020, the first batch of registration-based IPOs of 18 enterprises debuted on the ChiNext board. The registration-based IPOs aim to replace regulatory IPO approvals with administrative registration, giving the market a greater say in IPOs and making equity financing easier for tech companies with a shorter and more transparent IPO process.

One year on, the registration-based IPO system has contributed to the building of a multi-level capital market and serves the high-quality development of the real economy in a better way.

The following are the latest facts and figures on the development of the country's registration-based IPO system on the ChiNext board.

-- The Shenzhen-based ChiNext board was established in 2009 with 28 listed companies. As of Monday, the number of listed companies on the ChiNext board had exceeded 1,000.

-- The total market value of listed companies on the ChiNext board had reached over 13 trillion yuan (2 trillion U.S. dollars) as of Monday, second only to the NASDAQ.

-- A total of 182 companies listed under the registration-based IPO system had made a debut on ChiNext board as of Aug. 20, 2021, accounting for 18 percent of the total number of ChiNext firms.

-- Enterprises listed under the registration-based IPO system had an outstanding performance in 2020, with average operating income of 2.341 billion yuan and net profits of 211 million yuan, both above the average level of the board.

-- As of Aug. 20 of this year, nearly half the companies listed on ChiNext board were related to strategic emerging industries, including information technology, new materials and high-end equipment, while 91 percent came from the high-tech sectors.

-- Over the past year, the ChiNext Index rose 25.12 percent with the average daily turnover reaching 192.6 billion yuan.

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Keyword: IPO

Reading:

China pledges further institutional opening-up of capital market

China's ChiNext board raises140-bln-yuan IPO capital under registration system

China's RMB assets remains attractive globally: experts

Foreign institutions rev up layouts in China as capital market opens wider

China greenlights 2 IPO applications

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