China's IPOs Shrink to Two-year Low in Q3 amid Bear Market

China's initial public offerings (IPOs) shrank to a two-year low of 72.27 billion yuan (11.12 billion U.S. dollars) in the third quarter of this year amid a global market downturn, the ChinaVenture Investment Consulting Group said on Oct 10.

In the third quarter, a total of 90 Chinese companies launched IPOs in both domestic and overseas capital markets, down 22.4 percent from last year and 11.8 percent from the second quarter. The capital raised from the IPOs dropped 71 percent year-on-year and 35.7 percent quarter-on-quarter, according to a report from the consulting firm.

The report said in the domestic market, 31 companies went public on the ChiNext Board, China's NASDAQ-style growth enterprise board, 26 on the Small- and Medium-sized Enterprises Board and nine on the main board of Shanghai Stock Exchange. Overseas IPOs were mainly seen in Hong Kong and only Chinese video-sharing website Toudu was listed in the United States.

Gaoxin Retail (06808.HK) which made its debut in Hong Kong in July, topped the list by raising 8.24 billion Hong Kong dollars. It was followed by Founder Securities (601901.SH) and Great Wall Motor (601633.SH), which raised 5.85 billion yuan and 3.96 billion yuan, respectively.

Analysts attributed the decreases to a bearish global market and stricter scrutiny by Chinese authorities. The government has tightened control over new IPOs and a faltering global economic recovery weighed on negative market sentiment, resulting in many Chinese firms postponing their IPOs, said Wang Jia, an analyst with the consulting group.

Source: Xinhua