(Yicai Global) July 22 -- Today is the second anniversary of the Shanghai Stock Exchange’s Star Market. A total of 311 firms have landed on the Nasdaq-style board so far, raising more than CNY380 billion (USD58.8 billion) in initial public offerings, or nearly 60 percent of the SSE’s total IPO haul over the two-year period.
Officially known as the Shanghai Stock Exchange Science and Technology Innovation Board, the Star Market saw 171 newcomers in its second year, 31 more than in its first 12 months.
Except for information technology firms, the number of listed companies from various industries on the board increased this past year. The new energy sector had the largest gain with 14 businesses going public on the Star Market, according to Yicai Global data.
As of yesterday’s close, the board’s listed companies had a combined market value of CNY4.76 trillion (USD736.4 billion), accounting for 5 percent of all Chinese mainland-listed stocks. Six had a market cap in excess of CNY100 billion (USD15.5 billion) each, with Beijing Kingsoft Office Software ranking first at over CNY180 billion.
Investment in research and development by Star Market-listed firms continues to grow. As of July 15, 310 notched up combined R&D spending of CNY42.2 billion last year, up almost 23 percent from 2019 and making up 11.7 percent of their revenue in 2020, Yicai Global data showed. Some 190 spent more on R&D than in 2019, while 120 spent less.
The board’s second year also heralded improvements in its rules and mechanisms. In April, the China Securities Regulatory Commission revised the Star Market’s listing standards, adding a new clause that R&D personnel must account for 10 percent or more of the IPO applicant’s total headcount.
The clause also explicitly bans firms in real estate and those mainly engaged in finance and investment from listing on the Star Market.
On July 15, China issued a guideline to support high-level reform and opening-up of Shanghai’s Pudong New Area. According to the guideline, the Star Market will be the first mainland board to introduce a market maker system.
Editors: Dou Shicong, Peter Thomas