On April 3rd news, according to foreign media reports, China encourage Alibaba group and other technology giants in the domestic market of CDR (China depository) pilot program is getting quite early positive response, which indicates that the stock may soon landing A shares. The plan also won the support of Lei Jun, the founder and chief executive of millet.
Millet supports the move to allow overseas listed companies to issue CDR in China. It is said that his company is preparing for IPO (initial public offering), which may become the largest IPO since Alibaba's $25 billion IPO in 2014.
China now has some of the world's fastest-growing and most valuable technology companies, but BAT Baidu, Alibaba and Tencent are not listed on the mainland.The launch of the CDR is aimed at bringing the shares back to the domestic market, and their valuations are likely to be raised as local consumers become more aware of their products.China's State Council announced its pilot plan on Friday, less than a month after the idea was made public
The CDR pilot will apply to companies listed overseas and have a market value of more than 200 billion yuan (about $32 billion). It is for some of the other companies listed is a relatively simple path, including the valuation of more than 20 billion yuan and revenue amounted to 3 billion yuan of Private Companies, and the rapid growth in the field of advanced technology, and has the advantage of non-listed company.
The Alibaba also expressed support for the CDR, but is waiting for the new plan to be further clarified.
Analysts from China International Finance Corporation estimated that 35 overseas listed Private Companies were eligible, and they expected to raise 1 trillion and 500 billion yuan in financing. According to their report, they may also be part of the pilot program, such as Alibaba, its ants, gold clothing, dripping trip and Beauty Group reviews.
Many companies, including the Tencent listed in Hongkong and the Baidu listed in New York, have said that CDR will be considered. During the last month of the two meetings, several companies also expressed support for domestic listing, including the NetEase and the 58 city.
One of the reasons why Chinese technology companies are listed overseas is that their venture investors are investing in US dollars, Lei Jun said. To return money to limited partners, they need to be listed overseas. The CDR plan will solve the problem by allowing both mainland and overseas markets to be listed.
He refused to comment on whether millet was ready to issue CDR.
Xiaomi's early investors include Qualcomm Ventures and IDG Capital.The company is said to be preparing IPO as soon as this year
Millet is currently focusing mainly on developing countries, but the company says it will also enter the U.S. market in the future.