Chinese regulators have given the green light to 11 companies to pursue new listings in what will be the first fresh share sales to domestic investors for more than a year.
Shaanxi Coal and Chemical Industry Group is the largest potential initial public offering of the bunch and could look to raise almost $3bn, which would be the biggest Chinese share sale since Agricultural Bank of China in 2011.
The China Securities Regulatory Commission gave the nod to six companies yesterday, said state media, which followed approval for five others on Tuesday.
Most of the companies given the go-ahead to date are small groups pursuing listings of only a few tens of millions of dollars, and will seek to list on the ChiNext or SME boards on the Shenzhen stock exchange.
Before 2013, China was one of the most important venues for initial public offerings, second only to the US. In the first 11 months of 2012, the Shanghai and Shenzhen stock exchanges raised a combined $16.4bn from new listings, according to Ernst & Young.
However, the mainland market has been on lockdown since November 2012 due to concerns that new equity raisings would sap liquidity and damp sentiment in a market struggling to reward investors.
At one point, almost 900 companies queued to raise funds. Authorities responded with an IPO freeze, fresh checks on accounts, and encouraged some to target Hong Kong.
Yet none of those moves has helped to cheer investors. Over the past five years, the Shanghai Composite has been the worst performing major index. In 2013, the Shanghai market fell 5 per cent while the S&P 500 rose nearly a third.
Some analysts say the pool of domestic money is deep enough to absorb fresh equity. International investors have also lamented the shutdown, due to the lack of new trading opportunities. The CSRC signalled at the end of November the IPO market was to be reopened in the new year.
Global sentiment towards China has lifted in the past two months, after China’s rulers revealed a package of reforms aimed at shifting the economy to a more sustainable growth model.
Due in part to the restrictions on cross-border investment, sovereign wealth funds and other institutional investors have used the revival in the Hong Kong market to ramp up exposure to the country.
A successful listing for Shaanxi Coal would represent an early win for Cinda, the former bad bank that listed in Hong Kong in December. Cinda owns a 2 per cent stake in a Shaanxi subsidiary, while the coal group owns a nearly 10 per cent stake in insurer Happy Life, controlled by Cinda.
陕西煤业(Shaanxi Coal and Chemical Industry Group)是这批潜在首次公开发行(IPO)中规模最大的公司，寻求募集近30亿美元资金，这将是自2011年中国农业银行(Agricultural Bank of China)上市以来最大的A股发行。
2013年之前，中国是全球最重要的IPO平台之一，仅次于美国。安永(Ernst & Young)表示，在2012年的前11个月里，上海证券交易所和深圳证券交易所的IPO募资总额达到164亿美元。
然而，这些举措没有让投资者感到振奋。过去5年期间，上证综指(Shanghai Composite)是表现最差的主要股指。2013年，上证综指下跌5%，而标普500指数(S&P 500)上涨近三分之一。