The mainland securities regulator has tightened approval procedures for fund-raising through share issue by listed companies in 10 sectors, including property.
Property developers from now on won't be eligible for share placement unless they receive a go-ahead from the Ministry of Land and Resources, said an official with the China Securities Regulatory Commission. But even those who get the nod from the land watchdog will have to get the CSRC's approval.
Listed companies in the other nine sectors - cement, glassware, coal, polycrystalline silicon, wind power equipment, electrolytic aluminium, shipbuilding and welded equipment - are required to get the clearance of the National Development and Reform Commission before applying to the CSRC for additional share offerings.
'This shows the central government has stepped up efforts to rein in investment in sectors already mired in overcapacity,' said Bohai Securities analyst Zhou Xi. 'In theory, those companies won't be able to raise funds in the near future.'
Normally, listed companies can float additional shares if cleared by the CSRC.
The mainland is grappling with a slowdown following a massive infrastructure-focused stimulus package last year. The gross domestic product in the third quarter of this year was expected to grow 9.3 to 9.5 per cent, down from the 10.3 per cent in the second quarter, Shenyin Wanguo Securities said.
In May, the NDRC, the nation's major economic planning agency, warned of overinvestment and overlapping projects in certain industries, including steel and cement.
