SHANGHAI, Jan 9 (Reuters) - The first two Chinese companies set to list their shares on domestic exchanges after the end of a regulatory freeze said they had attracted strong investor interest, a good sign for dozens more that plan to follow this month.
Guangdong Xinbao Electrical Appliances Holdings Co Ltd said in a stock exchange filing on Thursday that it had raised 798 million yuan ($131.9 million) from individual and institutional investors.
The online part of the sale, which targeted mainly retail investors, attracted interest amounting to about 95 times the amount on offer, it said.
Zhejiang Wolwo Bio-Pharmaceutical Co Ltd, to be traded under the ticker, said it raised 506 million yuan, with the online portion of the sale 176 times oversubscribed.
China’s securities regulator signalled in December it would permit IPOs again after freezing new listings in November 2012. Chinese stock indexes have slid steadily since then, however, and many analysts say a flood of new issues will increase pressure on stock prices.
Beijing appeared to address that concern on Wednesday as state media reported that domestic insurers would be allowed to buy shares on the small-cap ChiNext exchange in Shenzhen, where many of the new IPOs will take place.
Regulators also recently encouraged state-owned firms to buy back their own shares, which could offset the dilutive effect of new listings.
The two companies are the first of 29 that have already announced plans for initial public offerings on the Shenzhen and Shanghai exchange websites. More than 700 companies have queued for regulatory approval to list.
Ernst & Young has estimated that new listings could raise as much as 200 billion yuan in 2014, more than twice what was raised in 2012 before the freeze.
The securities regulator said in November it expected around 50 companies to list this month alone.
Both of the new listings took place on the Shenzhen exchange.
The lead underwriters were Dongguang Securities Go. Ltd. for Guangdong Xinbao and Daiwa SSEC Securities Co. Ltd. for Zhejiang Wolwo, according to the prospectuses. ($1 = 6.0512 Chinese yuan) (Reporting by Pete Sweeney and Samuel Shen; editing by Jane Baird)