Industrials, Technology Author: Qasim Khan Nov 15, 2021 11:37 AM (GMT+8)

The stock exchange specializes in serving innovative small and medium-sized enterprises.

Beijing stock exchange

The opening day saw mixed results as 10 stocks that recently conducted Initial Public Offerings on the bourse surged, with the top gainer rising more than 500% in early trading.

The other 71 stocks that were transferred from the 'Select Tier' of the 'New Third Board' didn't gain as much.

Among the 81 listed companies in the first batch, the manufacturing industry and the information technology industry accounted for 70% and 16%, respectively, in line with the national incentive policy guidance. In terms of profitability, in the third quarter of 2021, the disclosed net profit rate of 75 companies reached an average of 14.3%, and the average year-on-year growth rate of net profit was 27.8%. From the perspective of valuation, the dynamic P/E ratios of the 81 firms averaged 35 times, which was lower than the Sci-tech Innovation Board and ChiNext.

Stocks will not be allowed to rise or fall more than 30% in a single trading day on the exchange, but earlier reports had said there would be no cap for the first day of listing.

On Monday, 10 newly-listed companies triggered temporary suspensions when their shares surged more than 60%, according to Barron's.

Yi Huiman, the chairman of the China Securities Regulatory Commission, said at an opening ceremony that "The new exchange is vital for improving financial support for SMEs, as well as promoting innovation-driven development." 

In terms of positioning, the Beijing Stock Exchange is upgraded from the selected layer of the New Third Board and will form a dislocation development with the existing two major exchanges and three major sectors of Shanghai and Shenzhen. From the perspective of functional positioning, the main board currently serves large and medium-sized listed companies, the ChiNext focuses on growth-oriented innovative and entrepreneurial enterprises, and the Science and Technology Innovation Board is positioned as a 'technological innovation enterprise,' while the Beijing Stock Exchange will build the main position for serving innovative small and medium-sized enterprises.

From the perspective of listing, the minimum market value is only CNY 200 million, which is lower than the ChiNext and the Science and Technology Innovation Board.