(Yicai Global) July 5 -- Nanhua Futures has passed its initial public offering review and is set to become the first company of its kind listed on the Chinese mainland, paving the way for similar firms to enhance their status in the domestic financial market.

The Zhejiang province-based firm will float up to 70 million shares on the Shanghai Stock Exchange, it said in a prospectus filed last year and published yesterday by the China Securities Regulatory Commission. Nanhua will use the cash raised to set up more branches, enhance its data systems, invest in other companies and innovate, it added, without disclosing the issue price or funding target.

Founded in 1996, the company had a net profit of CNY194 million (USD28 million) in 2017, up 18.8 percent from a year earlier. It had nearly CNY13 billion (USD1.9 billion) in assets at the end of 2017, CNY510 million in registered capital, and was 83.4 percent owned by Hengdian Group, one of China's largest private firms and also based in Zhejiang.

"Nanhua Futures' IPO success will help enhance the position of futures companies in the domestic financial market," The Paper cited Jiang Mingde, chief consultant at the Yixinweiye Fund, as saying. "It will help them manage risks, serve the real economy, and have a positive impact on global competition."

China Cifco Investment and several other listed firms have entered the futures sector via mergers and acquisitions on the Chinese mainland, but Nanhua is the first to go public independently through an initial public offering.

The CSRC's Deputy Chairman Fang Xinghai said at a forum in April that China needs to fortify policy support if it is to encourage more suitable futures companies to go public, a strong suggestion that more firms like Nanhua may hit the market soon.

Editor: James Boynton