Shanghai markets expand further with the addition of a growth enterprise board

Written by Denis Suslov || June 15 2015

A growth enterprise board in China is a part of stock exchange that has lower listing requirements and allows smaller, often high-tech enterprises to trade shares and gain access to a transparent funding channel. ChiNext, a part of Shenzhen Stock Exchange, is the southern city's growth enterprise board, has been very successful at attracting investors and issuers. Beijing also has its New Third Board, and now Shanghai, Eastern China's innovation center, will provide a venue for small high-growth companies to raise money on the capital markets.

The new marketplace is called Tech Innovation Board, is debuting on the Shanghai Equity Exchange and requires RMB 3 million in net assets for a company to list.

Approximately 50 firms are in the first group of companies to be listed, many from Zhangjiang Hi-tech Park, located in Pudong, Shanghai. Beijing has a similar innovation zone, called Zhongguancun, but its business ecosystem is complemented by the New Third Board, that was launched in 2012.

Growth enterprise boards are a great launch pad for companies and successful issuers often go on to list on bigger exchanges, as they have reporting track record and a transparent shareholder structure in place - a big attraction for investment banks, that will have less pre-IPO work to do. Chinese brokerages will likely follow the new board closely to spot companies that are ready for major exchanges.

shanghai tech innovation board market makers