IPOs to Increase Up to 50% in China This Year, Raising Nearly USD35.9 Bln, PwC Says
Yicai Global
/SOURCE : Yicai
IPOs to Increase Up to 50% in China This Year, Raising Nearly USD35.9 Bln, PwC Says

(Yicai Global) Jan. 4 -- Initial public offerings on China's A-share market are anticipated to continue to increase rapidly in 2017, according to a PricewaterhouseCoopers (PwC) report. PwC expects 320 to 330 A-share IPO listings to be made in 2017, raising CNY220 billion (USD 36.1 billion) to CNY250 billion.

The accelerated pace of IPOs means regulators are more eager to restore the financing function of the capital markets in the wake of substantial stock-market volatility in 2015, which will have significant implications for future work on deepening reforms, said PwC Assurance Partner Jean Sun.

Sun indicated that improving IPO approval efficiency, reducing businesses' queuing time and costs, strengthening IPO information disclosure and streamlining the administrative review of corporate investment value will help facilitate a gradual shift to the registration-based IPO system.

In 2016, 227 IPOs were made on the Shanghai and Shenzhen stock markets, an increase of four percent from 219 in 2015. Total proceeds accumulated were CNY150.4 billion, slightly lower than 2015's CNY158.6 billion. In particular, 103 IPOs in the Shanghai Stock Exchange Main Board accrued CNY101.9 billion last year.

Hong Kong remained the world's biggest IPO market last year, with 126 firms raising HKD194.8 billion (USD25.1 billion) from their Hong Kong listings. PwC projects that the launch of the Shenzhen-Hong Kong Stock Connect will help Hong Kong's stock market expand its basis, improve investment sentiment and will further consolidate the critical role that Hong Kong plays in the multi-level capital market of mainland China. Hong Kong is expected to see 130 new listings this year, collecting up to HKD220 billion.

"Due to global instability and IPO suspension and resumption in 2015, the A-share market was still in recovery mode in the first half of 2016, resulting in a moderate increase in IPOs from a low point," Frank Lyn, PwC China and Hong Kong Markets Leader, said at a press conference yesterday. "Generally speaking, the second half of 2016 saw a stable market operation and accelerated IPO verification, which are expected to be sustained."

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