SHANGHAI - Shares of 18 companies surged on their ChiNext debut on Monday, kicking off a historic reform that will see Shenzhen challenge Shanghai for tech listings.

Investors piled into the first batch of companies that list on Shenzhen’s tech-focused start-up board under a streamlined system for initial public offerings (IPOs) that will help simplify the listing process. Trading restrictions will also be loosened.

China's top security regulator said the move is of great significance to support the construction of the Guangdong-Hong Kong-Macao Greater Bay Area and Shenzhen

The biggest gainer among them, automotive cable maker Ningbo KBE Electrical Technology Co, jumped more than 500 percent in morning trading.

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Chairman of the China Securities Regulatory Commission Yi Huiman reiterated on Monday that regulators will have “zero tolerance” toward market misbehaviors, but will not interfere with normal trading activities.

Yi said the move is of great significance to support the construction of the Guangdong-Hong Kong-Macao Greater Bay Area and Shenzhen as well as better serve the high-quality development of the real economy.

Adopted in June 2020 after soliciting public feedback, the pilot registration-based IPO system is designed to ease enterprises' burdens and increase transparency with an open and paperless application review process.

Aimed at improving the market's transparency and authenticity while strengthening supervision, the system places information disclosure at its core while intensifying responsibilities of issuers and intermediary agencies as well as simplifying delisting procedures.

After more than a decade of growth, over 800 companies are listed on the ChiNext, with a market value of more than 9 trillion yuan. 

The 18 companies listed on Monday also include Contec Medical Systems Co, which jumped nearly 500 percent in morning trading, and Chengdu Dahongli Machinery Co, which was up about 200 percent.

READ MORE: Dongfeng Motor soars as it eyes mainland listing on ChiNext

Based on Shanghai’s year-old STAR Market, the broadening IPO reform will help strengthen the appeal of China’s capital markets at a time.

Abrahman Zhang, chairman of Shenzhen China Europe Capital Co, said the IPO reform benefited Chinese venture capitalists, who are finding it easier to raise tech-focused funds, and exit their investments via listings.

“Top policymakers are recognising that venture capitalists help boost productivity, rather than seek arbitrage,” Zhang said.