SHANGHAI, Sept 21 (Reuters) - China's Shanghai Stock
Exchange warned investors on Monday against colluding to
suppress the price of initial public offerings on its
Some investors are suspected of conducting what the stock
exchange has described as "negotiated offers" in their
subscriptions to shares of new listings, it said in a statement
posted on its website.
The exchange also said some lead underwriters -- the banks
which organise the IPOs -- were not offering independent
The Shanghai Stock Exchange will resolutely take regulatory
measures to deal with illegal acts and irregularities in the
process of IPOs in order to protect the healthy and stable
development of the STAR Market, it said in the statement.
The year-old market is set for a major boost later this year
when China's Ant Group, a financial technology giant, plans to
list on it and in Hong Kong in a dual listing expected to be
worth up to $30 billion.
The recent occurrence of super low offering prices
represents a "huddling-together" strategy by investors
anticipating that returns from new listings will drop as large
IPOs suck liquidity out of the market, analysts at China Galaxy
Securities said in report.
In a meeting held to discuss the recent phenomenon in the
IPO pricing process, the Securities Association of China said
that an important step in China's IPO reforms is to establish a
regulated and rational pricing mechanism and the Association
will have zero tolerance towards irregularities.
(Reporting by Luoyan Liu and Andrew Galbraith; editing by