Asia Economy

First Chinese IPOs in 4 months see strong debuts

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Shares of three Chinese firms soared in their Shenzhen stock exchange debuts on Thursday, the first mainland listings in over four months.

Within minutes of the Shenzhen bourse opening, shares of all the three companies jumped over 30 percent from their initial public offering prices (IPO).

The IPOs drew robust demand, with subscription rates of between 120 and 218 times over the number of shares on offer after the deals were priced at relatively cheap valuations.

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Early in the session, Wuxi Xuelang Environmental Technology, a waste disposal company, traded at 19.99 yuan, up 36 percent from the IPO price of 14.73 yuan.

Shares of Shandong Longda Meat Foodstuff, a meat processing company, was at 12.95 yuan, up 32 percent from the IPO price of 9.79 yuan.

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Feitian Technologies, a digital security firm, rose to 43.74 yuan, also up 32 percent from an IPO price of 33.13 yuan.

Under Shenzhen bourse rules, shares are allowed to rise up to 44 percent from their IPO price on their debut.

Pacific Securities underwrote Wuxi's share sale, while Guosen Securities was the underwriter for the other two companies.

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The China Securities Regulatory Commission restarted the IPO market earlier this year after halting listings for 14 months as it carried out reforms to curb speculation and improve the quality of firms planning to list. But after a flurry of activity in January and February, no offerings were approved until early June, when seven firms got the go-ahead.

The securities regulator is planning to approve about 100 IPOs for the rest of this year, bringing the full-year tally up to 150, about half the number forecast by consultants including PwC.