China shares down on IPO worries, losses limited by energy stocks
* Fears new listings will dilute capital dent market confidence
* Energy transmission stocks up on govt spending plans
* Changjiang Securities up 6.1 pct after strong 2013 profits
By Natalie Thomas
BEIJING, April 21 (Reuters) - China shares drifted lower on Monday, hit by concerns about a potential share oversupply after the securities regulator released draft prospectuses for 28 new companies planning to list.
Overall losses were partly offset by energy stocks after Premier Li Keqiang announced major projects in the sector would be rolled out soon, focusing on energy transmission, and cleaner energy sources such as hydro-power.
By midday, the CSI300 index of the largest Shanghai and Shenzhen A-share listings was down 0.3 percent, while the Shanghai Composite Index was also off 0.3 percent at 2,092.1 points.
Energy transmission companies were some of the biggest gainers as the government announced it would start construction on ultra-high voltage power lines to transport power from western regions to the power-hungry east coast.
Shares in TBEA Co Ltd climbed 2.9 percent, while Henan Pinggao Electric Co Ltd gained 1.1 percent, and China XD Electric Co Ltd rose 1.3 percent.
But the news was not enough to counter the loss in investor confidence following further indications that new listings may soon launch.
"The way the market sees the IPO news is that new shares will end up diluting capital, and what's more, this news is rather sudden," said Tian Weidong, head of research in Kaiyuan Securities in the city of Xi'an.
With more than 600 companies currently in the queue to list, the regulator has long sought to maintain a balance between allowing new companies to list and maintaining overall share value for existing firms.
Following a haiatus in listings in February, speculation was rife that the listing process may have gone into another freeze.
Elsewhere, shares in debt stricken Nanjing Tanker plummeted nearly 10 percent, the daily trading maximum, after the company said it had entered a market withdrawal adjustment period on Monday which would last thirty trading days.
But shares in Changjiang Securities Co Ltd gained 6.1 percent after the firm announced on Sunday that its 2013 profits were up 47.3 percent on the previous year.
The Hong Kong stock exchange is closed on Monday for the Easter holiday. (Editing by Jacqueline Wong)
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