The approval of Great Wall Motor Co Ltd's proposed A-share initial public offering (IPO) by the country's securities regulator will enable the company to double its production capacity in the world's largest auto market, analysts said.

The Hong Kong-listed company got the green light on Wednesday night to list on the Shanghai Stock Exchange. It submitted a draft prospectus to the China Securities Regulatory Commission (CSRC) last Friday.

According to the prospectus, Great Wall plans to issue up to 304 million A shares in a bid to raise 3.17 billion yuan ($492 million) for capital expenditure.

The issue price will be at least 90 percent of the average closing price of the company's H shares for the 20 trading days immediately before the application was submitted to the CSRC.

The proceeds will allow Great Wall to undertake three major capital expenditures: 410 million yuan for a diesel engine project that will have an annual output of 100,000 units, 570 million yuan for engine production facilities with annual capacity of 300,000 units and 570 million for projects to produce components such as axles and brakes.

The funds will also allow the company to nearly double its annual car output to about 800,000 units, increasing annual revenue by more than 8.54 billion yuan.

Based in Baoding in northern China's Hebei province, Great Wall Motor, which specializes in making sport utility vehicles and pick-up trucks under its own brand, reported three consecutive years of rising revenue starting in 2008.

Great Wall was the first privately owned Chinese vehicle manufacturer to list on the Hong Kong Stock Exchange, where it held an IPO in 2003.

Revenue in 2010 hit 22.18 billion yuan, up 78.9 percent year-on-year, noted John Zeng, director of JD Power Asia-Pacific Forecasting, a marketing information company.

"A newcomer to the passenger car arena, Great Wall Motor launched its first sedan, the C30, only in May 2010, but monthly sales have surpassed 10,000 units, which is a highly striking performance," Zeng told China Daily.

First-half sales rose 39.9 percent year-on-year to 238,395 vehicles, outpacing the 3.5 percent gain for the overall industry. First-half exports reached 34,197 vehicles, up 27 percent.

Revenue figures show the company's promising growth momentum, said Bill Peng, principal and auto specialist at Booz & Co Inc, a consulting company.

"Due to the fast expansion in the past three years, and the end of certain government preferential policies, many domestic car vendors have seen gross margins slump starting in 2011.

"Against all odds, the company still reported about 900 million yuan in first-quarter net profit," Peng told China Daily.

Great Wall Motor has long sought a mainland IPO. But its first application was rejected in 2008 amid the economic downturn.

"Back then, cash flow was abundant to support the company's development." But with the company's new Tianjin plant completed and "generating about 12 percent of its revenue from overseas, the CSRC recognized its need and qualifications for the IPO", Zeng said.

Great Wall Motor is following in the footsteps of electric carmaker BYD Co Ltd, another Hong Kong-listed vehicle producer, which turned to mainland markets to raise funds in June.