China to start review of 2nd-board IPO applicants

The seven companies, which span sectors of electronics to pharmaceuticals, want to raise a combined 2.2 billion yuan, or more than 320 million U.S dollars.

Liu Jipeng, a senior researcher with the China University of Political Science and Law, says the IPOs will ease small and medium enterprises' difficulties in financing.

"The IPOs will inject vitality into venture capital investment and risk investment, attracting more capital into the financial market. As long as we make steady efforts step-by-step, small and medium enterprises are bound to benefit from the IPO."

According to official statistics, 75 percent of new technologies come from small and medium enterprises. But financing has been, for a long time, a hard nut to crack for these enterprises.

It's widely believed that the GEM will channel more capital into some competitive technology-driven companies.

Jin Haitao, CEO of the Shenzhen Capital Group, the biggest domestic venture capital enterprise, believes that the launch of the GEM will trigger a new wave of investment.

"In the past, without enough experience, we were afraid to invest in some new fields, such as internet and high-end services. But now the situation has totally changed."

The China Securities Regulatory Commission will eventually vet applications from 149 firms that have applied for second-board IPOs, but will first review a handful of them starting on September 17.

Lin Yixiang is CEO of an invesment consultation company, which has been making a long-term efforts to promote the lauch of the GEM.

"IPO, actually will most benefit those small and mediun enterprises, which are pillars(?) of the market in the future. And the requirements of IPO are not that high. In a period of three years, it's likely that over 10,000 companies can join in the IPO by making some adjustments."

According to a report on the website of the China Securities Regulatory Commission, the second batch of IPOs will be reviewed Friday and they plan to raise 1.1 billion yuan.

Zhangcheng, CRI News.