China encourages home-based companies listed on the Hong kong market to back to booming A-share (Renminbi-dominated) market on the Chinese Mainland, said a regulator of the securities market.

Yao Gang, assistant to the chairman of China Securities Regulatory Commission (CSRC), made the remark at a recent working conference held by the Shenzhen Stock Exchange.

The CSRC, the country's securities watchdog, is also researching on the possibility and approaches of red-chip companies' listing on the mainland, Yao said.

Red-chip companies refer to those Hong Kong-listed enterprises whose major business is on the mainland but registered in tax-free regions such as the British Virgin Islands and the Cayman Islands.

Due to China's long-time bearish stock market, many of the profitable Chinese companies chose to launch their IPOs (initial public offerings) in Hong Kong or other places outside China.

Guangshen Railway, originally listed in Hong Kong, made its debut on the Shanghai Stock Exchange last Friday.

China Life, one of the first overseas-listed Chinese life insurer, plans to debut on the Shanghai market on January 9, 2007.

Domestic investors will have better opportunities to share the profit of quality companies if more overseas-listed companies go back to the mainland market, analysts said.

The China Mobile, PetroChina and Ping An Insurance, Hong Kong-listed giants respectively in China's telecommunication, petroleum and insurance area, are also on the waiting list to return to mainland market.

As Chinese investors regained their confidence about share market, the finance and refinance capacity of the mainland bourse has been greatly enhanced since this year.

Yao expected the mainland stock market to raise more than 210 billion yuan (27 billion U.S. dollars) through IPO and refinancing this year.

China will also push quality conglomerates to get listed on the mainland and overseas market simultaneously, Yao said.

(For more biz stories, please visit Industry Updates)