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BIZCHINA> Top Biz News
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Green light for 7 GEB suitors
By Bi Xiaoning and Zhang Ran (China Daily)
Updated: 2009-09-18 08:40
The securities watchdog yesterday gave seven companies the green light for initial public offerings (IPO) on the to-be-launched growth enterprise board (GEB) anticipating the turnaround in the bourses to help boost investor sentiments. A total of seven companies have entered the primary IPO review procedures yesterday. All the companies have met the listing requirements for the main board in terms of financial indicators. According the companies' prospectuses, their accumulated net profit in the past three years has surpassed 30 million yuan ($4.4 million), the minimum threshold for listing on China's main board. One of the firms, Lepu Medical Technology (Beijing) Co even posted 415 million yuan of accumulated net profit over the past three years. "Besides the financial requirement for the GEB companies, we also pay much attention to the companies' information disclosure, growth prospects and the ability to innovate," said Jiang Xinhong, an experienced accountant and a member of the IPO review committee for the GEB. According to the China Securities Regulatory Commission (CSRC), 149 companies have submitted applications for listing on the GEB, which intends to raise a combined 33.6 billion yuan. Though there are some market apprehensions that to-be-launched GEB may derail the rebound of the main board, industry analysts said there is no need for panic.
Earlier, China State Construction Engineering Corp issued 42.6-billion-yuan new shares. Metallurgical Corp of China recently announced plans to raise up to $5.3 billion through dual listings on the mainland and in Hong Kong. The capital raised by the two industry heavyweights both exceeded the combined 33.6 billion yuan of capital set to be raised by the 149 GEB companies. The regulator said that six more companies would enter the primary IPO review procedures today, indicating that the GEB could be launched by early October to fund high-growth start-ups. "Launching the GEB in October is ideal as the main board would have stabilized by then after a two-month correction and continue its rebound in tandem with the global rebound," said Li Daxiao, director of research at Yingda Securities. Buoyed by the to-be-launched GEB, many listed securities companies saw their share prices go up yesterday. The country's top listed securities firms, including Hongyuan Securities, CITIC Securities Co and Haitong Securities Co, climbed about 2 percent yesterday. "China's economic growth may quicken to 10 percent or more in the fourth quarter because of stimulus spending and a recovery in exports," Chen Dongqi, a researcher at the country's top economic planning agency, the National Development and Reform Commission, said at a conference in Shanghai yesterday. JP Morgan also said in a recent report that it was optimistic about the A-share market in mid- and long-term, buoyed by the ample liquidity, the economy's strong recovery signals and active civil investment. (For more biz stories, please visit Industries)
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