Advertisement
IPO
BusinessChina Business

China’s IPO stocks surge by at least 48 per cent in busiest day of market debuts since November 2021

  • Five companies including Citic Metal started trading in Shanghai, while Shaanxi Energy and four others debuted in Shenzhen
  • New registration-based system evaluates IPO applications on the quality of information disclosure, instead of growth prospects

Reading Time:2 minutes
Why you can trust SCMP
People walk past a large screen showing stock exchange data in Shanghai. The Shanghai Composite Index has risen 15 per cent from an October low. Photo: EPA-EFE
Zhang Shidongin Shanghai
China’s onshore stock market had its busiest day for initial public offerings (IPOs) in 16 months, with 10 companies rallied by at least 48 per cent on their first day of trading in Shanghai and Shenzhen.
Advertisement
The 10 firms represented the first batch of mainboard listings approved under a registration-based mechanism. It marked the most number of stock debuts on a single day since November 15, 2021, when the Beijing stock exchange commenced operations with 10 new listings.

Five companies including Citic Metal and Zhongzhong Science and Technology debuted on the Shanghai Stock Exchange, while power generator Shaanxi Energy Investment joined four others on the Shenzhen bourse.

China decided in February to review all IPOs through a new system that evaluates listing applicants on the quality of information disclosure, instead of their growth prospects. As part of a reform of the country’s three-decade-old stock markets, the overhaul removed a cap on IPO valuations and the market price during the first five days of trading. A 10 per cent daily limit on either side is imposed after that.
The Shenzhen Stock Exchange. The combined values of shares that changed hands on the Shanghai and Shenzhen exchanges have surpassed 1 trillion yuan every day in April. Photo: EPA
The Shenzhen Stock Exchange. The combined values of shares that changed hands on the Shanghai and Shenzhen exchanges have surpassed 1 trillion yuan every day in April. Photo: EPA

“The registration-based system will reduce direct interference from the government, and be helpful in boosting the efficiency of resource allocation,” said Liu Min, an analyst at Chasing Securities. “It will increase support from the stock market to the economy by widening fundraising access for small and medium-sized companies and streamlining approval processes.”

Advertisement

Shenzhen CECport Technologies, which makes electronic components, rallied 222 per cent to 38.20 yuan and Dencare Oral Care surged 174 per cent to 56.64 yuan, making them the best performers among the lot. Shaanxi Energy jumped 48 per cent to 14.20 yuan. The trio are listed in Shenzhen.

Advertisement