China unveils ChiNext reforms to bolster innovation, broaden listings

China released a reform plan for the ChiNext board on Friday, marking the official launch of a new round of reforms for the Nasdaq-style board in Shenzhen, Guangdong province, in a move to strengthen the country's innovation edge.

In a guideline on deepening ChiNext reform, the China Securities Regulatory Commission outlined a series of measures to support high-quality, innovation-driven enterprises that have yet to turn a profit, and those in new consumption and modern services sectors, encouraging them to list on ChiNext.

A fourth set of listing standards has been introduced on ChiNext to strengthen inclusiveness for innovative enterprises in emerging and future industries, allowing enterprises in those sectors that are not yet profitable, but demonstrate high revenue growth or strong research and development investment, to get listed.

The broadened listing access is aimed at better serving the development of new quality productive forces.

The reform aligns with the country's 15th Five-Year Plan (2026-30) blueprint, which highlights the development of strategic emerging industries such as next-generation information technology, new energy, new materials, intelligent connected vehicles, robotics and biomedicine, while fostering future industries including quantum technology, hydrogen energy, brain-computer interfaces and embodied artificial intelligence.

The fourth set of listing standards includes two sets of criteria. One requires an estimated market value of no less than 3 billion yuan ($439.3 million), revenue of at least 200 million yuan in the most recent year, and a compound annual revenue growth rate of no less than 30 percent over the past three years.

The other requires a market value of at least 4 billion yuan, revenue of 200 million yuan in the latest year, and cumulative R&D investment of no less than 100 million yuan over the past three years, accounting for at least 15 percent of total revenue.

The guideline's explicit support for high-quality, innovation-driven enterprises in new consumption and modern services sectors is expected to help dispel long-standing hesitations among companies and intermediaries over A-share listings in these sectors and enhancing the board's inclusiveness.

Aiming to improve review efficiency, the guideline also proposes a pilot mechanism allowing local governments to submit information on companies seeking ChiNext listings to the CSRC and the Shenzhen Stock Exchange as a reference for the review and registration process, rather than as a prerequisite for listing.

Additional reform measures include strengthening oversight across the listing process, refining ChiNext's IPO pricing mechanisms, introducing shelf registration for refinancing, launching market-making mechanisms, and exploring the timely launch of ChiNext stock index futures.

Market mavens noted that the reform plan is designed to reinforce ChiNext's role in serving growth-oriented innovative firms, with a focus on the commercialization and application of frontier technologies, distinguishing it from the STAR Market's emphasis on fostering core technological breakthroughs.