China’s first-quarter IPOs plunge 65% as regulator’s focus on listing quality saps pipeline

By Jerry  Published On April 2, 2024
China’s initial public offerings (IPOs) tumbled 65 per cent in the first quarter, a trend that is likely to persist through the year as the securities regulator has pledged to improve the quality of new listings and apply more scrutiny to listing applicants.

Twenty-eight companies have raised a total of 23 billion yuan (US$3.18 billion) by selling new shares on the mainland’s three exchanges, compared with 68 listings that raised 65.1 billion yuan in the first three months of 2023, according to Bloomberg data.

The slump reflects a shift in the regulator’s stance on fundraising, which investors blamed for causing a glut of stock issuance and contributing to a three-year downturn in stocks. The China Securities Regulatory Commission (CSRC) said it would tighten listing rules, particularly on applicants without a profit record, and conduct more random checks on applications to eradicate accounting fraud and prevent excessive fundraising.

These steps add to measures that have been in place since August to slow the pace of new offerings to bolster investors’ confidence.

China’s initial public offerings (IPOs) tumbled 65 per cent in the first quarter, a trend that is likely to persist through the year as the securities regulator has pledged to improve the quality of new listings and apply more scrutiny to listing applicants.

Twenty-eight companies have raised a total of 23 billion yuan (US$3.18 billion) by selling new shares on the mainland’s three exchanges, compared with 68 listings that raised 65.1 billion yuan in the first three months of 2023, according to Bloomberg data.

The slump reflects a shift in the regulator’s stance on fundraising, which investors blamed for causing a glut of stock issuance and contributing to a three-year downturn in stocks. The China Securities Regulatory Commission (CSRC) said it would tighten listing rules, particularly on applicants without a profit record, and conduct more random checks on applications to eradicate accounting fraud and prevent excessive fundraising.

These steps add to measures that have been in place since August to slow the pace of new offerings to bolster investors’ confidence.

Source: IPO


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