CSRC: New-share sales in H2 to be capped at 100
Print Edition
CHINA plans to have about 100 initial public offerings in the second half of this year, the securities regulator announced, easing investor fears over a glut of new shares.
“To stabilize market expectations, we plan to allow about 100 companies to go public from June through the end of this year, with a balanced number of IPOs each month,” Xiao Gang, chairman of the China Securities Regulatory Commission, said in an online statement late on Monday.
China has so far allowed 48 IPOs this year after lifting a 14-month ban. The number of planned IPOs this year is less than that of 2012 when 155 companies went public and much lower than the 282 IPOs in 2011 and 349 in 2010.
“The number of planned IPOs is less than our estimate,” said Mao Changqing, a CITIC Securities analyst. “The move is aimed at calming market sentiment after the Shanghai market dropped below the 2,000-point level on Monday.”
The brokerage had expected about 140 companies to get listed on domestic stock markets in the second half of this year.
The benchmark Shanghai Composite Index has fallen more than 5 percent this year amid fears that the comeback of IPOs will lead to a glut of new offerings and divert funds from existing shares. As of last Thursday, 595 IPO applicants were awaiting regulatory approval to sell new shares, CSRC data showed.
The regulator’s statement comes as China is looking to overhaul its IPO system, gearing it toward a registration-based mechanism.
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