Let's see what coolbluewater has to say,
but in the meantime, the tide is still changing in favor of AIVI investors both from the micro and macro points of view. The macro view is interesting too:
"... Last month the China Securities Regulatory Commission issued new guidelines that are much more market-driven, and less dependent on the discretion of Chinese regulators. "What they're talking about is going to a system similar with the U.S." says Paul Gillis, a professor at Peking University's Guanghua School of Management. "You clear your IPO with the regulators; you let companies go to the market when they choose to."
In the past, regulators judged whether companies were ready to go public in a process that could involve 10 steps and several years.
The IPO channel was shut down in October 2012 after a sharp decline in share prices and reports of fraud and misleading accounting. Up to then, Greater China (including Hong Kong and Taiwan) had become the world's largest IPO market, reaching $132.8 billion raised in 2010 before dropping sharply to $29.4 billion in 2012, according to a PricewaterhouseCoopers report.
The new rules reflect a promise by China's new leadership to loosen government controls on the economy. Under the old system, regulators often favored poorly run state enterprises while smaller private companies could wait years for approval.
"The new rules are a good step towards a system in which firms that meet the standards can go to the stock and bond markets," says David Dollar, an expert on the Chinese economy at the Brookings Institution in Washington. "Up until now regulators have had a lot of discretion about what IPOs and bond issues could go forward. "
"With the reopening of the IPO window, there will be a flurry of new listings."
"The new guidelines and the reopening will be good news for foreign investors who want to cash out of Chinese companies, Lin says.
DCM, a Silicon Valley venture capital firm with $2 billion under management has invested in 30 Chinese companies, making the firm a "moderate" investor in China, according to Lin. "We have institutional investors who want to get their money out (of USA). It provides exits for investors."
Some observers say that regulators were prodded to issue the new guidelines by Alibaba's decision to forgo a Chinese exchange for an IPO in the U.S. that could raise as much as $100 billion. But foreign investors say not all IPOs are suited to the Chinese domestic market.
