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China’s IPO Frenzy

Volume 4, 2014

The long-awaited Alibaba listing on the New York Stock Exchange has helped whip Chinese and American investors into an IPO frenzy.  And with the company expected to raise about USD$20 billion, which would make this the largest ever tech IPO in US history, the rest of the world is sitting up and taking notice.

The scrutiny comes at a time when the Chinese government is itself grappling with its own efforts to bolster the country’s IPO market. The market reopened this June, after months of government enforced inactivity as it moved to address long-standing issues that have dampened performance over the years.  There has been discussion of changes ahead that will loosen the China Securities Regulatory Commission’s grip on the approval process, moving China’s IPO market more in line with what applies in the west. Other issues that will have to be confronted to ensure a healthy market include perceptions of a lack of transparency and over-pricing, and China’s large pool of small investors who have yet to grasp the concept that there is no guarantee of perpetual profit.

In this Cover Story, we look at the major issues facing China’s IPO market as it goes through this vital period of transformation. Read on for more in:-

Chinese IPOs are Hot Again. CEIBS Professors Ding Yuan, Henrik Cronqvist and Oliver Rui weigh in on the latest developments.

JD.com: Life after IPO. An update from CEIBS EMBA 2009 alumnus and Founder of JD.com, Liu Qiangdong.

An Insider’s View on China’s IPOs. Managing Director of Eastern Harbour (Shenzhen) Investment Management Company, Dan Bin (EMBA 2007), analyses the market.