At a press conference on economic policy during the fourth Session of the 14th National People’s Congress on March 6, Wu Qing, chairman of the China Securities Regulatory Commission, said regulators plan to introduce a more targeted and inclusive listing standard on the ChiNext board.
Wu added that the new framework would support high-quality innovative companies in sectors such as emerging consumer businesses and modern services seeking public listings on ChiNext.
The comments were widely interpreted by the market as a signal that China’s Nasdaq-style growth board could soon open its doors wider to companies in emerging consumer and service-related industries.
For years, strict profitability requirements and a strong emphasis on technological attributes in mainland China’s A-share listing rules meant many leading consumer brands, including Pop Mart and Miniso, had little choice but to list in Hong Kong instead. If the proposed reforms move forward, they could reshape expectations in the venture capital market and potentially lead to a reassessment of consumer company valuations in China’s stock market.
Why the A-share market avoided consumer companies
A review of China’s IPO landscape in recent years reveals a clear structural bias, heavy on manufacturing and light on consumer businesses.
According to statistics from iFinD, 100 of the companies that went public in China’s A-share market in 2025 came from the manufacturing sector, accounting for 86.21% of the total. By contrast, only three companies from wholesale and retail listed during the same period, while two came from the information communication, information technology services, and software sectors.
This imbalance reflects regulatory priorities. Consumer companies typically generate relatively stable cash flow, meaning their financing needs may appear less urgent than those of technology firms. At the same time, regulators often view emerging consumer business models cautiously because their profitability can be volatile or uncertain. This perception can further reduce their priority in the IPO queue.
The current ChiNext listing framework illustrates this barrier. Its three existing listing standards impose relatively high thresholds related to profitability or revenue scale:
- Under the first standard, a company must report positive net profit for the past two consecutive years with a combined total of at least RMB 100 million (USD 14.5 million).
- The second standard combines requirements tied to market capitalization, revenue, and profitability.
- The third standard relaxes profit requirements but still requires companies to achieve a market value of at least RMB 5 billion (USD 726.8 million) and annual revenue of no less than RMB 300 million (USD 43.6 million).
For emerging consumer companies that remain in a rapid expansion phase and have yet to achieve stable profitability, these thresholds are often difficult to meet.
The challenge became more pronounced after a policy introduced in August 2023 slowed the pace of mainland IPO approvals as authorities sought to stabilize the secondary market. With fewer listing slots available, consumer companies moved further down the queue.
Meanwhile, Hong Kong has become the preferred IPO destination for many consumer-facing brands.
In 2025 alone, 119 companies listed in Hong Kong, raising a combined HKD 285.7 billion. Among them, the discretionary consumer sector ranked fifth in total IPO fundraising, raising HKD 4.93 billion.
Data from Wind show that as of February 9 this year, another 67 consumer companies were still waiting to list in Hong Kong.
Why regulators may now be embracing “new consumption”
The regulator’s explicit reference to emerging consumer sectors and modern services may signal a shift in policy thinking.
In China’s policy and investment circles, “new consumption” generally refers to consumer businesses driven by younger demographics, digital platforms, branding, and lifestyle-oriented spending. These companies often operate in segments such as designer toys, boutique coffee chains, specialty beverages, trendy retail, and experiential services targeting Generation Z and younger consumers.
While mainland regulators previously took a cautious stance toward such companies, Hong Kong’s market has produced several strong performers.
Pop Mart, for example, recorded strong share price gains in 2025 despite earlier concerns among some analysts that its valuation had been underestimated. The company’s stock rose more than 110% during the year, delivering an annualized return of 112.79%.
Tea chain GoodMe has also attracted investor interest. Since its Hong Kong listing last February, its share price has climbed 157.24%, with an annualized return of 192.61%.
The strong performance of these companies suggests that emerging consumer business models can deliver sustainable profitability while generating attractive investor returns. If similar companies were to list on the A-share market, they could broaden investment opportunities for retail investors and support the long-term development of China’s capital markets.
Another potential beneficiary of ChiNext’s policy shift could be consumer companies already listed in Hong Kong whose business models and earnings power have gradually been validated but whose valuations remain relatively subdued.
Pop Mart offers a case in point. As a leading player in designer and collectible toys, it spent years trading under valuation pressure before 2025. Last year, the company also experienced a transition from market exuberance to a more restrained valuation environment. Its share price remains volatile, and its forward price-to-earnings ratio has fallen below 40 times.
However, a research report by SPDB International suggests the company’s domestic revenue has maintained strong growth momentum in early 2026. The report estimates that Pop Mart’s revenue in mainland China during January and February could grow by 130–160% year-on-year. It also expects quarterly revenue from the second through fourth quarters to remain broadly in line with the first quarter, leading the firm to conclude that Pop Mart may currently be significantly undervalued.
If ChiNext introduces a fourth listing standard in the future, potentially allowing qualified companies to pursue secondary listings or spinoffs, companies such as Pop Mart could gain access to multiple capital markets while expanding globally.
At the same time, consumer behavior in China is changing rapidly.
As Gen Z becomes a more influential economic segment, China’s consumption patterns are undergoing structural change. Spending is increasingly driven by self-reward, quality upgrades, and emotional or lifestyle experiences rather than purely functional needs.
These emerging consumption patterns have fueled economic activity while creating new supply chains. Supporting such companies in the capital market could diversify the industrial structure of China’s stock market and allow investors to participate in the growth of new consumer trends.
A broader exit channel could reshape expectations
For investors, reforms could have far-reaching implications for both venture capital and public market valuations.
Historically, venture capital firms have been cautious about backing emerging consumer brands because even successful companies in these sectors often struggled to qualify for A-share listings due to unstable earnings or unconventional business models.
A more flexible ChiNext listing framework would provide clearer expectations for exit opportunities. This could encourage investors to back earlier-stage startups and smaller companies that may not yet be profitable but demonstrate strong growth potential.
Over time, such a shift could stimulate greater capital inflows into emerging consumer sectors and create a cycle linking industrial innovation with capital formation.
Another factor shaping the discussion is valuation.
Historically, consumer companies listed in the A-share market have traded at higher valuation multiples than their counterparts in Hong Kong.
At present, consumer stocks in the mainland market often trade at price-to-earnings ratios above 30 times, compared with roughly 18 times for consumer companies in Hong Kong.
For example, Tsingtao Brewery trades at roughly 18 times earnings in the mainland market, while China Resources Breweries trades at about 13 times in Hong Kong. Beingmate trades at around 46 times earnings in the mainland market, whereas Feihe, known internationally as Firmus, trades at under 12 times in Hong Kong.
Several mainland-listed liquor companies command even higher valuations. Yanghe trades at roughly 37 times earnings, Shuijingfang around 32 times, and Shede Spirits about 111 times.
Part of this divergence reflects differences in market structure. Hong Kong’s market includes a larger share of discretionary consumer companies, including retail, food service, and apparel businesses, which tend to experience larger valuation swings during economic cycles. By contrast, the mainland market has historically been dominated by staple consumer companies whose valuations are generally more stable.
These valuation gaps suggest that if emerging consumer companies gain a pathway back to the mainland market, their potential market capitalization could expand significantly. That prospect could enhance shareholder returns and attract long-term institutional capital.
For the A-share market itself, the impact could also be structural.
For years, China’s consumer sector in the mainland stock market has been dominated by traditional blue chip companies such as liquor makers and home appliance manufacturers, leaving the valuation framework relatively static.
The arrival of new-generation consumer companies could reshape that landscape. As more consumer brands listed in Hong Kong potentially return to the mainland market, the valuation structure of China’s consumer sector may gradually evolve.
Companies with durable competitive advantages and sustainable growth prospects would likely command more stable valuations, while speculative stocks driven primarily by hype could see their premiums fade. Over time, that shift could move China’s consumer equity market toward a more disciplined and sustainable pricing framework.
KrASIA features translated and adapted content that was originally published by 36Kr. This article was written by Wang Hanyu for 36Kr.
Note: RMB figures are converted to USD at rates of RMB 6.88 = USD 1 based on estimates as of March 12, 2026, unless otherwise stated. USD conversions are presented for ease of reference and may not fully match prevailing exchange rates.