Published on ShanghaiDaily.com (http://www.shanghaidaily.com/)
http://www.shanghaidaily.com/sp/article/2008/200812/20081216/article_384614.htm
Board plan a spur for start-ups
Created: 2008-12-16 0:21:26
Author:Winny Wang
START-UP companies are back in focus for investors after the Chinese government reiterated the importance of the sector by calling for the launch of a growth board.
The State Council, or China's Cabinet, issued a statement at the weekend calling for effective measures to stabilize the stock market, including establishing a Nasdaq-like growth board. The board is intended to assist the development of start-up companies and firms with a lower listing threshold.
This was the second time within a month that the government called for the establishment of the growth board. Shang Fulin, the chairman of the China Securities Regulatory Commission, said earlier this month that China will strengthen its support for small and medium-sized companies and will launch the growth board at an appropriate time.
"The launch of the growth board had never been mentioned at high-ranking meetings as I recall so the statement signaled a real development of the sector. Venture capital-related companies will attract the focus of investors," said Zhang Xiang, an analyst with Guodu Securities Co.
Dozens of VC-related companies, which mainly invest in start-up high-tech companies, are listed on the Chinese mainland.
Shanghai Fudan Forward S&T Co Ltd surged the daily cap of 10 percent to 6.57 yuan (96 US cents) a share and Shanghai Tongji S&T Industrial Co Ltd also jumped 10 percent to 5.63 yuan.
Qi Bin, director of the research center of the commission, said on Saturday that the growth board should be introduced as soon as possible to promote interconnection between high-innovation businesses and the capital market.
"The government is likely to issue more stimulus measures for sales of non-tradable shares, buffer funds and new share sales to stabilize the market," said Yi Lei, an analyst with Shanxi Securities Co.
The State Council also said the country would accelerate approval processes to promote more mergers and restructuring among qualified companies.
"Asset restructuring is an important method to allocate the sources of the equity market, so we expect 2009 to be a year of mergers and restructures," Yi said.
The government encourages the expansion of bond issuance, including corporate bonds, short-term financing bonds and medium-term notes.
The State Council, or China's Cabinet, issued a statement at the weekend calling for effective measures to stabilize the stock market, including establishing a Nasdaq-like growth board. The board is intended to assist the development of start-up companies and firms with a lower listing threshold.
This was the second time within a month that the government called for the establishment of the growth board. Shang Fulin, the chairman of the China Securities Regulatory Commission, said earlier this month that China will strengthen its support for small and medium-sized companies and will launch the growth board at an appropriate time.
"The launch of the growth board had never been mentioned at high-ranking meetings as I recall so the statement signaled a real development of the sector. Venture capital-related companies will attract the focus of investors," said Zhang Xiang, an analyst with Guodu Securities Co.
Dozens of VC-related companies, which mainly invest in start-up high-tech companies, are listed on the Chinese mainland.
Shanghai Fudan Forward S&T Co Ltd surged the daily cap of 10 percent to 6.57 yuan (96 US cents) a share and Shanghai Tongji S&T Industrial Co Ltd also jumped 10 percent to 5.63 yuan.
Qi Bin, director of the research center of the commission, said on Saturday that the growth board should be introduced as soon as possible to promote interconnection between high-innovation businesses and the capital market.
"The government is likely to issue more stimulus measures for sales of non-tradable shares, buffer funds and new share sales to stabilize the market," said Yi Lei, an analyst with Shanxi Securities Co.
The State Council also said the country would accelerate approval processes to promote more mergers and restructuring among qualified companies.
"Asset restructuring is an important method to allocate the sources of the equity market, so we expect 2009 to be a year of mergers and restructures," Yi said.
The government encourages the expansion of bond issuance, including corporate bonds, short-term financing bonds and medium-term notes.
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