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Domestic IPO resumes after nine-month freeze

GUILIN Sanjin Pharmaceutical Co will launch the first initial public offering on Chinese mainland in nine months as the regulator has eventually lifted the ban after the sagging stock market recovered.

The traditional Chinese medicine maker today received the approval from the China Securities Regulatory Commission for the new stock sale in Shenzhen, investment banking sources told Shanghai Daily.

Sanjin is expected to start a preliminary price consultation with investors next week and may finally list its shares late this month or early next month, said the sources familiar with the matter.

"Sanjin is a small-size firm and its listing won't likely cause big pressure on liquidity or cause the index to plunge," said Xu Wenyu, a China Galaxy Securities Co trader. "The company can fetch a good valuation as people will definitely chase the first IPO after waiting for such a long time."

The CSRC halted domestic IPOs in September after the Shanghai Composite Index slumped nearly 60 percent in the first nine months of last year on worries more equity supplies may lead the market to collapse.

The benchmark stock barometer has gained more than a third since the suspension started partly thanks to the government's fiscal stimulus package, which is on track to help the country's economy step onto a recovery path.


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