New board for niche sector SMEs begins trading

The new board for small and medium-sized companies specializing in niche sectors, commanding high market share and boasting strong innovation capacity started trading at the Shanghai Equity Exchange on Monday, with the first batch of 162 companies successfully floated.

The new board is directly connected to the China Securities Regulatory Commission, the country's top securities watchdog, by using blockchain technology, said Guan Xiaojun, president of Shanghai Exchange Group, the parent company of Shanghai Equity Exchange.

Such connection can help more companies specializing in frontier technologies but still in their earlier development stage, or those with much growth potential, exposed to regulatory commission's radar. In other words, the candidate pool for listed companies will be expanded, which is conducive to improving the quality of public companies, he said.

A basic structure made up of private equity and venture capital share transactions, comprehensive services for stock options, and the new board for technologically advanced small and medium-sized has been thus established at the Shanghai Equity Exchange upon the latest move, according to local financial officials attending the Monday ceremony.

The new board will also help strengthen the ties between the different layers of the Chinese capital market, making due contribution to the deepened reform of the registration-based initial public offering mechanism, said Guan.

An alliance aiming to serve technologically advanced and innovation-driven SMEs, as well as credit products especially designed for the new board, were unveiled on the Monday launching ceremony.

Also launched on Monday is the fund share valuation service system, which is jointly developed by the Shanghai Equity Exchange and professional institutions. The system can provide pricing references for both transaction parties.