In October, 10 A-share IPO candidates underwent review, all passing successfully, including Xiamen Uxun Chip Co., Ltd. and Xi'an Taijin New Energy Technology Co., Ltd., which were reviewed for the second time. Only two companies terminated their IPO processes during the month, marking the lowest monthly termination count this year.
Nine companies completed IPOs in October, raising a combined RMB 12.869 billion. From January to October 2025, 87 companies listed on the A-share market, raising a total of RMB 90.172 billion, distributed among 34 underwriters. Notably, First Capital Securities, Dongguan Securities, and Soochow Securities—strong performers in 2024—have yet to secure any IPO underwriting deals this year.
**IPO Terminations: Kunlun Lian Tong Fails Again, Orient Securities Warned for Negligence** Only two companies withdrew their IPO applications in October, the fewest this year. Kunlun Lian Tong Technology Development Co., Ltd. (Kunlun Lian Tong) and Zhuzhou Keneng New Materials Co., Ltd. (Zhuzhou Keneng) terminated their listings, with Orient Securities and Shenwan Hongyuan Securities as their respective sponsors.
Kunlun Lian Tong, an IT infrastructure solutions provider, previously withdrew a mainboard IPO application in March 2024 after filing in June 2023. Its latest withdrawal marks a second failed attempt. Regulatory scrutiny focused on revenue authenticity, including questionable major clients like FORTUNE GLOBAL, which became a top customer shortly after its 2020 incorporation despite minimal capital.
Orient Securities, the sponsor, was also warned for failing to fulfill due diligence obligations.
Zhuzhou Keneng, aiming for a STAR Market listing, faced doubts over its innovation credentials. Its cumulative R&D spending of RMB 84.9615 million from 2021–2023 barely met the RMB 80 million threshold under new rules. Metrics like patent counts and R&D personnel lagged behind peers.
**IPO Issuance: Daosheng Tianhe’s High Audit Fees** Among October’s nine IPOs, Xi'an Yicai-U raised the most (RMB 4.636 billion), while Changjiang Nengke raised the least (RMB 184 million). Three loss-making firms—Xi'an Yicai-U, Heyuan Bio-U, and Bibettech-U—debuted on the STAR Market’s growth tier.
Daosheng Tianhe stood out with a 12.89% issuance cost ratio (RMB 101.6923 million fees on RMB 789 million raised), notably higher than peers. Its audit fees (RMB 19.2 million, 2.43% ratio) topped comparable listings. Pre-IPO, the firm distributed RMB 250 million in dividends—81.17% of 2021–2023 net profits—nearing regulatory scrutiny thresholds before adjusting its reporting period to avoid classification as "excessive dividends."
**Underwriting Landscape: First Capital Securities, Soochow, Dongguan Securities Yet to Secure Deals** From January–October, 34 underwriters shared RMB 90.172 billion in IPO proceeds. CITIC Securities led with RMB 12.827 billion, while a combined Guotai Junan-Haitong tally would rank first at RMB 13.191 billion.
First Capital Securities, which handled three IPOs (RMB 1.071 billion) in 2024, recorded zero underwriting this year. On October 29, it was investigated for negligence in supervising Hongda Xingye’s (delisted) 2019 convertible bond project.
Regulators found Hongda misused RMB 1.691 billion of raised funds (total: RMB 2.415 billion), fabricated profits (RMB 4.077 billion over 2020–H1 2023), and hid major lawsuits (RMB 2.714 billion). First Capital, as lead underwriter and supervisor until 2021, failed to detect these violations, raising questions about its oversight.
Comments