Xinhua Finance/Milken Institute Chinese IPO Indicator Update: IPO Indicator reaches new high despite mainland market corrections

Xinhua Finance/Milken Institute Chinese IPO Indicator Update: IPO Indicator reaches new high despite mainland market corrections

July 23, 2007

    SHANGHAI, China, July 23 /Xinhua-PRNewswire/ -- 

    (Logo: http://www.xprn.com/xprn/sa/200611140926.gif )

    Indicator Change
    June 2007: 254.3
    May 2007: 251.1
    Month-to-month change: 1.3%
    June 2006: 185.8
    Year-to-year change: 36.9%

    Click here to download the chart
   
http://www.xinhuafinance.com/en/charts/ipo_rpi/0707/ipo_chart0707.jpg

    Highlights

    The IPO indicator reached a new high of 254.3 at the
end of June, despite a series of policy actions taken to
cool down the overheated stock market. Three stocks were
added to the indicator, and one was deleted, bringing the
total to 112.

    Analysis

    Of the 110 equities included in the indicators in both
May and June, seventy-six dropped in price and thirty-four
increased. Prices for the Industrial and Commercial Bank of
China (ICBC; A share, 601398; H share, 1398)'s A and H
shares showed signs of convergence as mainland investors
were allowed greater access to invest in Hong Kong-listed
issues. Its A shares made the largest single negative
contribution to market capitalization, while its H shares
were the most positive factor toward the indicator market
value increase in June. In addition, three coal companies -
China Coal (H share, 1898), Shanxi Lu'an (A share, 601699),
and Huolinhe Opencut (A share, 002128) - contributed to 22
percent of the increase in the indicator's market
capitalization. 

    Methodology 

    A stock's float-adjusted market capitalization over
time forms the basis for indicator calculations. Stock
dividends, stock splits, special dividends, share
consolidations, repurchases, spin-offs, and combination
stock distributions may trigger adjustments to the
indicator values. Only companies incorporated and domiciled
in mainland China that go public on the Shanghai, Shenzhen,
and Hong Kong stock exchanges are included. Companies are
removed from the indicator after twelve months.

    Xinhua Finance/Milken Institute China Indicators 

    The Xinhua Finance/Milken Institute China Indicators
provide investors, analysts, and financial professionals
insight into China's money and capital markets. Five of the
eight indicators have been launched since November 2006: the
Renminbi Pressure Indicator, the Chinese IPO Indicator, the
Market Adjusted Debt (MAD) Indicator, the Banking Strength
Indicator (BSI), and the Adjusted Trade and Finance (ATF)
Indicator. The remaining three indicators (the China
M&A Indicator, the China Privatization Indicator, and
the China Corporate Governance Indicator) will be launched
later this year. 

    Period Coverage and Frequency 

    New companies are added to the indicator as soon as
they are listed, while current companies are removed after
twelve months. The IPO Indicator has a base date of
December 31, 1997, when the indicator's value was set equal
to 100, and covers the period from December 31, 1991, to the
present. Values are calculated on a monthly basis. The
indicator for each month is released in the third week of
the following month. 

    Sources of Data 

    The real-time and historical trading data used in the
construction of this indicator are provided by Bloomberg
and Xinhua Finance; underlying information used to
calculate the float ratio is obtained from a variety of
sources, including Xinhua Finance's subsidiary Mergent,
stock exchanges, regulators, and the companies themselves.
Corporate actions are sourced from Xinhua Finance,
regulatory filings, and news services.

    To view additional information, visit
www.xinhuafinance.com/indicators and
www.milkeninstitute.org/chinaindicators. 

    Xinhua Finance Limited is China's premier financial
information and media service provider and is listed on the
Mothers Board of the Tokyo Stock Exchange (symbol: 9399)
(OTC ADRs: XHFNY). Bridging China's financial markets and
the world, Xinhua Finance serves financial institutions,
corporations and re-distributors through five focused and
complementary service lines: Indices, Ratings, Financial
News, Investor Relations, and Distribution. Founded in
November 1999, the Company is headquartered in Shanghai
with offices and news bureaus spanning 11 countries
worldwide.  For more information, please visit
www.xinhuafinance.com. 

    The Milken Institute is a nonprofit, independent
economic think tank whose mission is to improve the lives
and economic conditions of diverse populations around the
world by helping business and public policy leaders
identify and implement innovative ideas for creating
broad-based prosperity. The Milken Institute has extensive
expertise in China and conducts ongoing research on China's
banking and capital markets. It is based in Santa Monica,
Calif. For more information, please visit
www.milkeninstitute.org.


    For more information, please contact:

    Xinhua Finance

    China

     Ms. Joy Tsang
     Tel:   [phone]
     Email: [e-mail]

     Mr. Scott Zhang
     Tel:   [phone]
     Email: [e-mail] 

    Taylor Rafferty (Media contact for Xinhua Finance)
     
    Japan 

     Mr. James Hawrylak
     Tel:   [phone]
     Email: [e-mail]

    United States

     Mr. John Dudzinsky
     Tel:   [phone]
     Email: [e-mail] 
 
    Europe

     Faisal Kanth
     Tel:   [phone]
     Email: [e-mail] 

    Milken Institute:

     Ms. Jennifer Manfr¨¨
          Associate Director of Communications
     Tel:   [phone]
     Email: [e-mail]