A SECOND batch of 12 companies have obtained approval from China’s securities regulator to list shares since it restarted approving initial public offerings (IPOs) in June.

    The China Securities Regulatory Commission (CSRC) has allowed six firms to get listed on the Shanghai Stock Exchange and the rest on the Shenzhen exchange.

    Eleven of the 12 companies have published their IPO prospectuses and are seeking to raise a combined 3.4 billion yuan (US$548 million) in proceeds. The companies range from machinery makers to pharmaceutical firms.

    Automation control system manufacturer Chongqing Chuanyi Automation Co.’s IPO is among the biggest as it aims to raise up to 626 million yuan by selling up to 100 million new shares.

    A Securities Daily report yesterday said the new batch of IPOs is expected to lock up 766.5 billion yuan in funds.

    The CSRC resumed the IPO market earlier this year after halting listings for 14 months. But after a two month flurry of activity, no offerings were approved until early June, when seven companies got the go-ahead.

    The CSRC has said it will stop involving itself in IPO pricing and move to a registration-based system similar to that employed in developed economies, where the market effectively decides who gets to list and for how much.

    However, the regulator has so far kept a tight leash on supply and pricing, announcing earlier this year that companies which set their IPO price-to-earnings ratios higher than the ratios of industrial peers in the secondary market will need to publish repeated risk warnings before they open subscriptions to retail investors. It has also carried out spot checks on price consultations and pre-marketing of IPOs.

    “A lot of regulators try not to interfere in the IPO price and there is a lot of reason to support this trend, but China has its own special economic arrangement,” said Ringo Choi a partner at Ernst & Young.

    “The CSRC has its own reasons to monitor pricing, so the stock market will not overheat, which is in line with the general planned economic policy in China.”

    Last month, domestic media quoted the head of the CSRC as saying about 100 IPOs were expected for the rest of this year, which would bring the full-year tally up to 150. (SD-Agencies)