New IPO pricing rules call for greater disclosure
Institutional investors can now participate in bookbuilding
To streamline listing and keep a tight rein on excessive valuations, participants in initial public offerings (IPOs) must be more transparent in the pricing process, say counsel.
The China Securities Regulatory Commission (CSRC) further reformed the IPO pricing mechanism by issuing new rules on October 13. The rules expanded the participation of institutional investors into the bookbuilding process and strengthened disclosure requirements.
The new regulation, which will take effect on November 1, also puts forward restrictions on certain practices that may be related to inflating an IPO's valuation.
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