Shenzhen Bourse's Nasdaq-Style Board ChiNext Starts Trading after Reform
ChiNext saw 18 IPOs on the first day. Some surged as high as 500%.
China has deepened reform on the stock market and the decade-old ChiNext board started with a bull run on the first trading day after the reform. ChiNext is a subsidiary board under the Shenzhen bourse, which is designed for growth companies.
Founded in 2009, ChiNext has over 830 listed companies including some big names like CATL (300750:SZ) and Mindray Medical (300760:SZ). Shanghai Star Market and Shenzhen ChiNext now are piloting stock market reform in China – gradually the reform will enhance the activity on the mainboard with intensity.
On the first day after the reform, over 18 companies were newly listed (newly-listed companies’ tickers started with the letter “N”). Under the new rules, there are no ceilings or floors for new stocks on the first five trading days. The newly-listed KBE Electrical (300863:SZ) stock surged as high as 521% and triggered several circuit breakers with temporary halts.
Prior to implementing the new regulations, the ChiNext board had also been in a bull market. The post-reform first day’s trading value exceeded CNY 180 billion (USD 25 billion) in the middle of the day.