The Beijing Stock Exchange (BSE) was officially launched on 15 November, only 75 days after Xi Jinping’s announcement in September. Eighty-one stocks started trading today, a record high in China’s stock market, with many more expected to be tradeable in the coming weeks.
Amongst those available now, ten companies that recently went public on this new stock exchange saw their shares surge as much as six-fold and triggered circuit breakers. After Shenzhen and Shanghai’s Stock Exchanges, Beijing Stock Exchange will be the third major stock market in mainland China.
Located opposite the China Securities Regulatory Commission, this new bourse aims to become China’s version of the Nasdaq, America’s technology-based stock exchange. It’s designed to help “little giants”, highly innovative small businesses, raise capital without having to look outside China’s borders.
Out of the first batch of listed stocks, seventy-one were transferred from an over-the-counter market in the capital city, known as the National Equities Exchange & Quotations, which struggled to attract capital due to the lack of liquidity.
However, that couldn’t limit the potential of small and medium-sized companies, who have seen large investment, and one of the main benefits to this opening of the Beijing Stock Exchange.
One of them was Shenzhen BTR New Energy and Materials Company Limited, whose market value has reached over 90 billion RMB ($14.1 billion), ranking the top on the new Beijing exchange. Companies listed on the Beijing Exchange, if qualified, can directly migrate to Shenzhen’s ChiNext or Shanghai’s STAR markets, where you can find China’s most promising tech companies.
“With President Xi endorsing the exchange, I see little chance of this market failing,” said Yang Hongxun, an investment analyst. Beijing is home to 93 unicorn companies valued at over $1 billion, more than any other city in China, including tech giants ByteDance and Baidu. The kick-off of this new exchange is one important step of a broader strategic plan, making the capital into an “international innovation and technology hub” and a “leading city in the digital economy“.