IPOs to restart in China's A-share markets by end January 2014

Written by || December 24 2013

The China Securities Regulatory Committee (CSRC) announced in December that the currently non-active A-share IPO market would reopen at the end of January, 2014.

In addition to listings re-starting, there are big changes in the mechanisms listings and a registration system that more closely matches that of the more mature western markets. Previously, the CSRC had responsibility to check the validity of the documents that pre-IPO firms submitted for due diligence. Now, CSRC has passed this responsibility to investors and the markets, so it is quite possible that many previously unqualified firms will now have chance to get themselves listed on A-share markets. There seem to be more than 50 firms that will comprise the first batch of pre-IPO companies to list the A-share market by the end of January.

The chart below shows the attitudes of Chinese private fund managers’ towards the new IPO registration mechanism on the A-share markets. In general, 75% of the interviewees indicated that they believed the new IPO registration mechanism is positive in the long run, while about 43.75% of the interviewees expressed their concerns for the short-term strong diluting effects on the stock index prices and individual stock prices. Fund Managers Attitudes to Opening IPO market in China