The resumption of initial public offerings in China has hit another obstacle, as a group of Chinese companies on the verge of listing have abruptly halted the IPO process amid apparent regulatory uncertainty.
Five Chinese firms have told the Shenzhen stock exchange that they will postpone their IPOs after China’s stock regulator, China Securities Regulatory Commission, (CSRC), said over the weekend that it would strengthen its supervision of IPOs, especially on the issue of valuation, when IPOs are priced at premiums to industry peer groups. The regulator also said it will introduce spot checks of book-building and road shows.
The five companies delaying their IPO plans are NetPosa Technologies, Hebei Huijin Electromechanical, Nsfocus Information Technology, Beijing Forever Technology and Ciming Health Checkup Management Group.
Listings on the Chinese stock markets were suspended by authorities in August 2012 as a response to difficult trading conditions on China’s markets. Since then there have not been any IPOs on the Shanghai or Shenzhen markets.