Do the Rigorous Listing Requirements Matter for IPO Assessment in the Chinese Stock Market?

With the context that the Chinese government reforms its IPO assessment mechanism to registrationbased
system, this study, using two multivariate regression models based on prior studies, aims to
examine whether the Chinese rigorous listing requirements are able to help the stock exchange to
screen high quality IPO firms. It suggests that the approved IPO companies have better performances
than failed ones, but the listing requirements lose IPO-screening functions, because the majority of
listed companies performed poorly rather than better after their IPOs. This result is different from
previous findings that regard an IPO market as a screening device in the developed stock markets.