A flood of new offerings will test investor demand for Shenzhen's already pricey ChiNext board today, when the index begins trading under revamped rules that removes daily price limits for debut shares. The companies raised a combined of 20 billion yuan (HK$22.4 billion) from their ChiNext listings, with retail demand outstripping supply by an average of around 5,700 times. The reforms are a landmark in China's efforts to liberalize its capital markets and Beijing will want a smooth implementation of changes to the $1.3 trillion ChiNext board. New share sales won't be subject to price caps in the first five trading days, while daily limits on existing stocks will double to 20 percent. The ChiNext trades at 37 times forward 12-month earnings versus a 14 multiple for the CSI 300 index.

Source: The Standard August 23, 2020 19:07 UTC