China IPOs find Nasdaq home

The year 2014 will be remembered as the year the Chinese IPOs returned.

Bob McCooey, senior vice-president of listing services for the Nasdaq OMX Group, said this year that 10 Chinese companies have opted to list on the Nasdaq Stock Market in New York.

The initial public offerings have generated added excitement about US-based listings from Chinese firms, he said.

"The excitement around the listings are making companies more confident about coming to the US markets, which is certainly a big change from what we saw just a couple years ago," McCooey told China Daily on Tuesday. "IPOs for these companies are another stop on the road, but it is the start of another long march."

McCooey is responsible for maintaining the relationships with more than 3,400 Nasdaq-listed companies. There are 115 Chinese companies on that list, Nasdaq data show.

"Being a Nasdaq-listed company says something, and that's why so many companies have their ticker symbol on their business card," he said. "It's well-known all across China, and for entrepreneurs - especially in the technology sector - it's a badge of honor."

Nasdaq has held 186 IPOs in 2014, up 60 from last year, an increase of 47.6 percent. IPO proceeds on Nasdaq in 2014 totaled $21.6 billion, market site data showed.

More than 60 percent of all stock listings in the US this year have been on Nasdaq, including 29 IPOs in the tech sector. And 37 of the 61 international IPOs (60.6 percent) listing this year in the US have been on Nasdaq.

Numbers for Chinese IPOs have rebounded in 2014 following the lifting of China's freeze on IPOs in December 2013. The China Securities Regulatory Commission put the ban in place in 2013 to reform the system.

Many of the companies that listed in 2014 are in the e-commerce and Internet services sector, including online retailer JD.com, Chinese microblogging website Weibo Corp, online jobs site Zhaopin Ltd, and online-based leisure-travel company Tuniu Corp.

Weibo, commonly referred to as China's Twitter, raised $285.6 million during its first day on Nasdaq in April.

JD.com, also known as Jingdong Mall, is the biggest direct seller of online goods in China and the country's second largest e-commerce company - second only to Alibaba Group Holding Ltd. JD.com raised $1.78 billion in its IPO on Nasdaq in May, the biggest IPO by a Chinese company on Nasdaq.

Alibaba, which helps connect buyers and sellers alike through six online marketplaces, made its IPO in September on the New York Stock Exchange (NYSE). The company raised more than $25 billion, the largest global IPO ever.

This year's top-performing Chinese companies include: Tuniu (33.8 percent increase in shares from IPO price of $9), Zhaopin (28.9 percent climb from $13.50), JD.com (21.7 percent uptick from $19), and Alibaba (55.5 percent jump from $68). Tuniu had its IPO at Nasdaq in May while Zhaopin listed on the NYSE in June.

"JD and Alibaba going public resonates well with the entrepreneurs in China," McCooey said. "The ability of both of those companies to list in the US says something dramatic about what a great market we have here."

The trend of Chinese companies opting to list in the US is expected to continue, McCooey said.

"One thing that's important to understand is that we don't go into a market, whether it's China or any other market, and try to convince a company that listing in the local market is a bad thing," McCooey said.

"The reality is we are competing for a small number of companies who have already decided that they are going to list in another market outside of China, so we are there to convince them that other market should be Nasdaq.

"Technology investors are here in the US; they understand the way technology companies evolve, grow, etc," he said. "That becomes a draw for a number of these Chinese companies. The US has the greatest capital markets in the world, bar none, and the pipeline from China continues to be very strong."

jackfreifelder@chinadailyusa.com