GEM board financing channel for smaller firms

Seven GEM applicants are being reviewed by the securities regulator. And many other small and medium sized companies are considering joining them, as the second board could solve their capital shortage.

This company in Beijing which focuses on technology for the protection of the environment is seeking to list on the GEM Board. The company said it was short of funds to further expand. And it can gain more room to develop if listed on the GEM board.

Capital shortage is a common problem that many smaller companies are facing. A chip design firm in Nanjing says it is cooperating with many big mobile phone makers, but capital shortage is curbing its development.

Wang Sanming, GM of An Yuan Technologies, said, "When smaller companies develop to a certain stage, capital shortage becomes a problem. I think the GEM Board will give us more confidence and support."

Zhan Donghui, GM of Meganovo Technologies, said, "For innovative technology start-ups like us, the second board is a good channel to raise capital. It will definitely boost the development of smaller companies."

Many smaller companies say there are credit restrictions on them and it's hard for them to secure enough loans from commercial banks. So GEM Board is a better choice.