Nine applicants accepted for new Nasdaq-style board

The Shanghai Stock Exchange accepted listing applications from nine high-tech companies for the coming technology innovation board, a Nasdaq-style tech board in China announced in November by President Xi Jinping.

The nine companies, including Shanghai-based chip designer Amlogic, span from semiconductor, new material, robot to bio-pharmaceutical industries. The average market capitalization is estimated at 7.28 billion yuan (US$1.09 billion), the Shanghai Stock Exchange said on Friday night. 

The green light for the first applicant companies marked the countdown of the new board, which is expected to welcome its trading debut in the middle of 2019.

“It represents a new era of the Chinese capital market and brings a new eco-system and game rules,” Liu Xiaodan, chairwoman of Huatai United Securities said in an entrepreneurship conference in Shanghai on Saturday.

Different from current IPO application systems with complicated and long-term regulation approval processes, Shanghai’s upcoming technology innovation board has simplified the listing procedures and allowed listings by startups that have yet to turn a profit.

That encourages high-tech firms to grow and develop through the capital market, which will boost technological innovation and stimulate the whole economy.

Institution investors, instead of retail investors, will have more rights on the new board, which will make the whole market healthy and professional in the long term, Liu said during the 2019 Entrepreneurship Summit in Shanghai. 

Nine pioneer applicants

The companies accepted by the exchange also include Beiren Robot, HeJian Technology (Suzhou), Wuhan Keqian Biology, Ningbo Ronbay New Energy and Ankon Technology (Wuhan) Co.

Three of the nine companies are chip-related firms.

Amlogic, the new technology board’s first accepted IPO applicant, designs chips used in smart TVs and set-top boxes. 

Hejian Technology (Suzhou) plans to raise about 2.5 billion yuan through the IPO in semiconductor manufacturing, the biggest figure among the nine. Hejian is the only applicant among the nine still losing money.

China's imports of integrated circuits passed a record US$300 billion last year, but the country still needs a “huge volume." The booming automotive, smartphone and smart devices markets will fuel demand through 2022, officials told Semicon China on Thursday.

Chip imports have been more than US$200 billion a year since 2014 and hit a record US$320 billion last year.

Several Shanghai-based semiconductor firms will probably seek IPOs with the new board, Shanghai Daily learned last week.

Many startups may also seek opportunities on the new board, which provides business spaces for IPR (intellectual property rights) valuation and exchange, said Xie Xuhui, chairman and CEO of the WTOIP.com, an IPR consultancy firm.

With clients like Huawei, Xiaomi, Midea, Starbucks and Nike, WTOIP is expected to handle transactions valued at 22 billion yuan in 2018. It is also in the process of applying for the new tech board, Xie added.

Wuhan-based Ankon Technologies, one of the nine applicants, develops a capsule-sized robot for painless stomach diagnosis in medical organizations. It announced previously it will invest heavily for a new production line in Zhangjiang.