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May 9, 2015

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Home » Business » Finance

Tech firms eye home relisting

By Vera Ye | May 9, 2015, Saturday | Print Edition

CHINESE technology companies previously trading on Wall Street are expected to relist on China’s stock exchanges driven by rising valuations of the domestic bourses, according to industry experts.

“Just a few years after Chinese technology companies flocked to sell shares in New York, the trend is reversing as a growing number of them are seeking to take their listings home in the next few years,” said Qian Xuefeng, founding partner and chairman of New Access Capital, a Shanghai-based corporate finance adviser.

“Stunning performances of their peers on domestic exchanges, especially those on the ChiNext board, are one of the main drivers,” Qian said yesterday at the Shanghai Investing Summit jointly organized by Darden School of Business of the University of Virginia and Antai College of Economics & Management of Shanghai Jiao Tong University.

The ChiNext board, China’s Nasdaq-style bourse for start-ups, has soared over 100 percent this year, with the average price-to-earnings ratio at around 100. That compared with a PE ratio of 30 for the Nasdaq stock market.

Beijing Baofeng Technology Co Ltd, a streaming and online video company, has seen its share price gain by the daily 10 percent limit for 31 trading days. Its shares have skyrocketed 25.6 times since its debut in Shenzhen in late March.

Chinese digital media group Focus Media, delisted from Nasdaq in 2013, is planning to list on the A-share market through a reverse merger as soon as next month.

Jumei International Holding Ltd, a Chinese online retailer of beauty products that listed in the US last year, is also planning to relist on the domestic stock market.

Qian told Shanghai Daily that the city’s pilot free trade zone could serve as a platform for overseas listed companies to return to the domestic capital market.

The State Council, or China’s Cabinet, said on Thursday the government encourages Internet companies to list on domestic exchanges.

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