SHANGHAI: China has given the green light for 10 firms to list on the country’s stock exchanges, officials said, after a four-month hiatus on initial public offerings but analysts warned of a share glut in an already weak market.
New listings were approved in January following a year-long, Beijing-imposed freeze to reform regulations and halt a slide in share prices, but they were halted in February owing to concerns about the new process.
But the Chinese Securities Regulatory Commission (CSRC) said late Monday it had “approved IPO applications of 10 companies” and that they would be split between the country’s two stock markets in Shanghai and Shenzhen.
As of yesterday morning, seven of the 10 firms had formally indicated their intent to list.
They include circuit board maker Ellington Electronics Technology which is seeking to raise 1.3bn yuan ($213m) in Shanghai, and Hongxiang Yixintang Pharmaceutical which expects to raise 794.5m yuan in Shenzhen. However, analysts said the timing of the decision could hit shares that are already listed.
“The resumption... will definitely lead to an imbalance between funds and stocks, and the market can only remain weak,” BOC International analyst Shen Jun said. AFP
