SHANGHAI: A string of 100-year-old Chinese companies have jumped on the bandwagon of seeking a public debut for renewed development impetus, a signal that the country’s capital market is scaling up support to nurture strong homegrown brands, market experts said.

       The latest case in point would be the Zhejiang Wufangzhai Industry Co Ltd, a market leader in the industry of rice dumplings or zongzi, which celebrates its centennial this year.

       The company is planning to raise 1.06 billion yuan (US$164mil or RM691mil) from an initial public offering (IPO) on the Shanghai Stock Exchange, Wufangzhai said in a regulatory filing released in June.

       The IPO proceeds will be used in areas like smart food workshops, a digitalised industrial park, research and development, and production base upgrades, the filing said.

       Meanwhile, Zhang Xiaoquan Inc, a domestic hardware manufacturer with nearly 400 years of history, is close to a public debut on ChiNext, a Shenzhen board heavy with innovative enterprises.

       It has been in the process of a regulatory IPO registration since April.

       The Shandong Dezhou Braised Chicken Co Ltd, a chicken cuisine firm more than 300 years old, also announced it kicked off the process for an IPO last year and has received pre-listing tutoring.

       Fu Yifu, a senior analyst at the Suning Institute of Finance, a research institution of Suning Finance, said time-honoured brands are seeking IPOs not only for more fundraising channels and a stronger brand reputation, but for better corporate governance as well.

       Though time-honoured brands boast cultural and economic value, many of them have fallen behind the times and have stuck with outdated management models, resulting in a lack of innovation and limited profitability.

       This is why time-honoured brands should actively transform themselves, Fu said.

       In addition to constantly looking for new business models and distribution channels, embracing a modern management mindset will be an advisable option, Fu said.

       “Seeking a public float can serve the latter purpose by altering the share structure with concentrated holdings by a single or few big shareholders, absorbing capital from multiple sources and optimising the governance scheme,” he said.

       The wave of time-honoured brands seeking public listings came amid the country’s efforts to nurture stronger homegrown brands and spur a consumption upgrade.

       The Ministry of Commerce, for instance, is helping rejuvenate time-honoured brands by a multi-pronged approach, including launching a shopping carnival for time-honoured brands in April that will last for the rest of the year.

       The carnival aims to make good use of traditional holidays, consumer goods exhibitions and shopping promotion campaigns to boost consumption and promote innovation of time-honoured brands, the ministry said.

       Nearly 50 time-honoured brands are now listed on China’s A-share market, mainly in sectors like liquor, traditional Chinese medicine, catering and condiments.

       Some of them are high-profile firms with robust profit growth, such as liquor maker Kweichow Moutai Co Ltd and traditional medicine producer Zhangzhou Pien Tze Huang Pharmaceutical Co Ltd.

       Their share prices closed as high as 1,982.9 yuan (RM1,291) and 421.67 yuan (RM275) last Tuesday, respectively. ― China Daily/ANN