SMEs Debuts in OTC Trading Platform in Qianhai
With a thirst for capital, more than a thousand small and medium sized enterprises made their debut in a OTC trading platform in Qianhai. The companies opened for business last Thursday doubling expectations. The Qianhai Equity Exchange, which is a regional over the counter market that was set up last year was given the task in helping these SMEs that are based in Shenzhen to help raise capital through the issuance of private debt and equity financing.
The first batch of 300 companies for the Qianhai exchange said that by this month the number of companies could exceed 500. The exchange is aiming to host 3,000 companies in the next three years and 10,000 in six years. Small companies located outside Guangdong will be accepting but for the meantime the exchange will be allowed to grow.
The Qianhai exchange is a step forward in the financial reforms in the city and the exchanges is distinguish itself by the low cost and low threshold for access. Cost for SMEs that is seeking financing in Qianhai was only 1/10th of the floor market. And any year old unlisted firm can get eligibility if they meet one of any four criteria.
Those earning less thatn 3 million yuan in net profits in the previous 12 months, those having less than 20 million yuan in the previous 12 months, those having no less than 10 million yuan in net assets and less than 5 million yuan in revenue in the previous 12 months and those having secured 1 million yuan in bank loans or from equity investors.