Funds raised via IPOs drop over 50% in H1
By Feng Jianmin |
July 4, 2012, Wednesday
|
Print Edition
Print Edition
FUNDS raised through initial public offerings in the first half of this year in Shanghai and Shenzhen tumbled more than 50 percent from the same period last year on worries about China's slower economic growth amid global uncertainties.
But experts expect IPO activities to sharply rebound in the second half of the year as the market situation is likely to turn for the better and also on the large number of companies already approved to list.
The Shanghai and Shenzhen bourses saw 77.5 billion yuan raised through IPOs during January to June, down 56 percent annually, PricewaterhouseCoopers said in a report yesterday, citing a worrisome economic outlook that has hurt investor confidence.
In Shanghai, 17 companies raised 28.8 billion yuan and in Shenzhen 48.7 billion yuan were raised by 88 companies as of June 30, the report said.
In a separate report also released yesterday, Ernst and Young blamed the weak IPO market globally for the Chinese mainland's situation. Funds raised through IPOs totaled US$59.2 billion in the first half, an annual 47-percent tumble, E&Y said.
Both firms, however, forecast that funds raised via IPOs in the second half on the mainland may double that in the first six months, to 200 to 250 billion yuan. That compared to 286.1 billion yuan raised last year.
Yuan Yongmin, E&Y's assurance partner, said liquidity may recover in the second half in tandem with an improvement in China's economic growth.
"That will create a better environment for the stock market to expand," he said.
"An important mission of the State-owned Assets Supervision and Administration Commission this year is to encourage listing of central government-owned enterprises. There may be large IPOs with fund-raising size exceeding 10 billion yuan."
More than 100 companies have been approved to list.
But experts expect IPO activities to sharply rebound in the second half of the year as the market situation is likely to turn for the better and also on the large number of companies already approved to list.
The Shanghai and Shenzhen bourses saw 77.5 billion yuan raised through IPOs during January to June, down 56 percent annually, PricewaterhouseCoopers said in a report yesterday, citing a worrisome economic outlook that has hurt investor confidence.
In Shanghai, 17 companies raised 28.8 billion yuan and in Shenzhen 48.7 billion yuan were raised by 88 companies as of June 30, the report said.
In a separate report also released yesterday, Ernst and Young blamed the weak IPO market globally for the Chinese mainland's situation. Funds raised through IPOs totaled US$59.2 billion in the first half, an annual 47-percent tumble, E&Y said.
Both firms, however, forecast that funds raised via IPOs in the second half on the mainland may double that in the first six months, to 200 to 250 billion yuan. That compared to 286.1 billion yuan raised last year.
Yuan Yongmin, E&Y's assurance partner, said liquidity may recover in the second half in tandem with an improvement in China's economic growth.
"That will create a better environment for the stock market to expand," he said.
"An important mission of the State-owned Assets Supervision and Administration Commission this year is to encourage listing of central government-owned enterprises. There may be large IPOs with fund-raising size exceeding 10 billion yuan."
More than 100 companies have been approved to list.
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