More than 400 companies are qualified for listing on China's SME (small and medium-sized enterprises) board of the Shenzhen Stock Exchange, the Business News Daily reported Tuesday.

There are 3,328 SMEs on the waiting list for going public on the SME board, which was established one year ago and now has 46 listed enterprises, according to the report.

The 408 companies have met the standard for listing on the SME board and will be considered first for going public, said the newspaper.

Many SMEs complain about the lengthy preparation period before listing and the high cost in China. As a result, some businesses choose to go public on overseas stock markets, the newspaper said.

In 2004, 81 Chinese enterprises chose their initial public offering (IPO) in Hong Kong, Singapore and New York, with IPO amount twice than that in domestic stock market, according to the newspaper. This practice makes the Chinese capital market less competitive, the newspaper said.

Source: Xinhua