CICC Analyst Issues Report, Calling for ‘Conservative’ 300% Return on New IPOs

Only in China. Can you imagine all of the fun a chinese version of Fred Wilson is having right now?

We conservatively estimate an average gain of ~300% after listing,” Wang wrote. “Although some companies will directly set the offering price, the pricing process is still expected to be subject to some potential restrictions such as the P/E ratio.”
Under the new IPO system, companies that sell less than 20 million new shares will be allowed to “directly” determine the offering price. That suggests IPO valuations above 23 times earnings may be allowed, though authorities still haven’t provided clarity on this point, Wang wrote.
The new rules will also abolish a requirement that investors make an advance payment when bidding for shares, which should ease the liquidity drain when new deals are priced.

Invest in Chinese IPOs; get 300% gains.

End story.