China encourages home-based companies listed on the Hong
kong market to back to booming A-share (Renminbi-dominated) market on the Chinese Mainland, said a
regulator of the securities market.
Yao Gang, assistant to the chairman
of China Securities Regulatory Commission (CSRC), made the remark
at a recent working conference held by the Shenzhen Stock Exchange.
The CSRC, the country's
securities watchdog, is also researching on the possibility and approaches of
red-chip companies' listing on the mainland, Yao said.
Red-chip
companies refer to those Hong Kong-listed enterprises whose major business is on
the mainland but registered in tax-free regions such as the British Virgin
Islands and the Cayman Islands.
Due to China's long-time bearish stock
market, many of the profitable Chinese companies chose to launch their IPOs (initial public offerings) in Hong Kong or other places outside
China.
Guangshen Railway, originally listed in Hong Kong, made its debut
on the Shanghai Stock Exchange last Friday.
China Life, one
of the first overseas-listed Chinese life insurer, plans to debut on the Shanghai market on January 9, 2007.
Domestic investors
will have better opportunities to share the profit of quality companies if more
overseas-listed companies go back to the mainland market, analysts said.
The China Mobile, PetroChina and Ping An Insurance, Hong Kong-listed giants respectively in
China's telecommunication, petroleum and insurance area, are also on the waiting
list to return to mainland market.
As Chinese investors regained their
confidence about share market, the finance and refinance capacity of the
mainland bourse has been greatly enhanced since this year.
Yao expected
the mainland stock market to raise more than 210 billion yuan (27 billion U.S.
dollars) through IPO and refinancing this year.
China will also push
quality conglomerates to get listed on the mainland and overseas market
simultaneously, Yao said.
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