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Foreign-funded mainland tech firms given nod to sell Chinese depositary receipts on Shenzhen’s ChiNext market
- Move comes ahead of President Xi Jinping’s visit to Shenzhen on Wednesday to mark the 40th anniversary of the establishment of the special economic zone
- Last month electric-scooter maker Segway-Ninebot became the first company to be given the nod to launch CDRs on the Star Market in Shanghai
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Beijing has ramped up efforts to attract foreign-funded mainland tech firms to list on domestic stock exchanges by giving the go-ahead to the ChiNext market in Shenzhen for Chinese depositary receipts (CDRs).
The move comes ahead of President Xi Jinping’s visit to Shenzhen on Wednesday to mark the 40th anniversary of the establishment of the special economic zone.
In the guideline issued on Sunday, Beijing said the launch of the CDR programme would be among the major financial reforms to reinforce the city’s development.
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“The investing public does expect a flurry of solid companies to raise funds via the depositary receipt system,” said Ivan Li, a money manager at Shanghai-based Loyal Wealth Management. “The document to encourage CDR issuance on the ChiNext market in Shenzhen is a good sign for investors.”
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The move to liberalise ChiNext comes after the securities regulator on September 22 gave Segway-Ninebot, an electric-scooter maker, the nod to float on the tech-heavy Star Market in Shanghai, making it the first company to issue CDRs. Segway-Ninebot, which is expected to raise 2 billion yuan (US$296 million) by floating 70 million CDRs, is yet to issue the CDRs.
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