Suning Alliance Chains, one of China's largest home appliance retailers, has gotten approval from the nation's securities watchdog to issue A shares.

Sun Weimin, vice-president of the Jiangsu-based retailer, told China Daily that the China Securities Regulatory Commission approved Suning's application for listing on the domestic main board market on Monday.

"The company is now actively preparing for the listing according to regulated procedures, but the timetable has not been decided," Sun said.

Company sources have said Suning plans to issue 25 million A shares and raise 400 million yuan (US$48.3 million) worth of funds.

"Money raised through the listing will be mainly used in expanding Suning's home appliance chain stores nationwide, building its logistics centre, and improving its information system," said Sun, although he refused to confirm all the details of the plan.

"However, whether the company will get listed successfully or not would not affect its future expansion."

Currently, Suning has opened some 80 outlets in 24 provinces and municipalities, with a sales volume of more than 12 billion yuan (US$1.5 billion) last year.

The company has said previously it will enter a rapid growth period as of this year and aims to open 100 new chain stores and achieve a sales volume of over 20 billion yuan (US$2.4 billion).

"The listing on the stock market is important for Suning's future development," said Zhang Bing, an industry analyst from CITIC Securities.

With a large sum of funds raised through the stock market, the company will be able to further expand and grow stronger to compete with its rivals like Gome and Dazhong, Zhang said.

According to a ranking list of chain stores made by the Ministry of Commerce earlier this year, Suning ranked seventh overall.

Its major rival Gome Home Appliances ranked third, with a sales volume of nearly 18 billion yuan in 2003, and a total of 139 outlets.

Analysts said that domestic home appliance retailers are competing to expand their businesses and trying to secure more market share, in a bid to survive when facing foreign players when the Chinese Government fully opens the market next year.

At the same time, seeking the public listing is the best way to raise funds for expansion.

China's largest home appliance retailer Gome is also preparing for its listing and is expected to appear on the Hong Kong stock exchange this year.

em>Source: Xinhua