Beijing plans listings push for state-owned firms
Beijing will push ahead with the listings of big state-owned firms this year as it seeks to speed up reform of the country's industrial giants.
But its plan to list these mammoth companies will be another heavy blow to the mainland's retail investors, 70 per cent of whom lost money on the stock market last year.
The China Securities Journal reported yesterday that the State-owned Assets Supervision and Administration Commission plans to list 16 group companies on the stock markets in 2011 as it tries to consolidate the major government-controlled firms.
A Sasac spokesman confirmed it would encourage more unlisted firms to launch initial public offerings, but declined to comment on the number planned for this year.
'The IPO number can't be set for now because the China Securities Regulatory Commission has a final say in share offerings,' he said.
The newspaper said China Minmetals, China Railway Signal & Communication and China Railway Materials Commercial have started preparing for share sales.
Sasac chairman Wang Yong said at the end of December that the government would let big groups list all their assets as a whole. Previously, the mainland spun off non-performing assets from major state companies, and only listed the profitable assets.
His remarks could suggest that some non-performing assets will be included in the listings, analysts said.
The state-asset regulator has been striving to consolidate assets in recent years, and reduce the number of major state-controlled companies to 100. It currently oversees 125 large state-owned companies. The government has also been encouraging large state-owned firms to merge or acquire other state-owned rivals.
The Sasac intends to focus on 30 to 50 state-owned companies, making them global leaders in their fields, Wang said.
The companies due to launch initial public offerings this year would normally use the Hong Kong-Shanghai dual-listing model, the China Securities Journal said, but the Sasac spokesman declined to comment on this.
Stock exchanges on the mainland and in Hong Kong topped the global markets in terms of IPO volume last year as mainland firms scrambled to raise funds.
The IPO frenzy caused a liquidity drain on the A-share market with the benchmark Shanghai Composite Index losing 14.3 per cent for the year.
