Biggest IPO Fundraising for 2016 to Hit 300 Billion Yuan
Accounting from PricewaterhouseCoopers said fundraising for the new IPO for 2016 in China is said to hit 250 to 300 billion yuan ,which makes the A-share IPO market the biggest globally. As the number of new IPOs is expected to reach 400 that is being fueled by registration based IPO system together with the launch of the Strategic Emerging Industries Board. Frank Lyn of PwC and Hong Kong Markets Leader believes that such measures is a positive influence on IPO activities and the acceleration of the registration system opens up further and enhance the A-share market. And because of the difference in the estimated value in the different capital markets, the trend in the Chinese companies returning to A-shares will continue.
China launch the registration based initial public offering system last March in hopes to boost the role of the country’s stock market to provide necessary financing for companies. Jean Sun a PwC China Assurance Partner stated that the core of the registration system will enhance information disclosure that will ensure issuers and intermediaries to take responsibility. Companies that plan to list must pay attention to the quality and sufficiency of information disclosure. PricewaterhouseCoppers also surveyed emerging enterprises and potential IPO applicants and saw about 80 percent of the applicants are planning to go public in the domestic capital market.
The key concerns of emerging enterprises has pointed out to ambiguous time frames required in verifying applicants, non-transparency of initial public offering procedures and financial conditions and profit requirements to qualify applicants. These same companies surveyed expected both the new registration system together with the Strategic Emerging Industrial Board would alleviate concerns.
There were 219 IPOs in 2015 on the Shanghai and Shenzhen stock exchange market, compared to 125 in 2014 and despite the listings suspension from July to November, fundraising reached 158.6 billion yuan an increase from 78.6 billion in 2014. Global capital markets fluctuated due to an uncertainty in the global economy, but the Hong Kong capital market remains relatively stable and strong.