BEIJING - Firms listed on China's National Equities Exchange and Quotation (NEEQ), also known as the "new third board," have gained more technical strength.

By the end of 2018, the number of patents held by the innovative firms on the board averaged 34 each, up 21.43 percent year-on-year, while 43.46 percent of the companies owned more than 20 patents for inventions.

Analysts attributed the growing technical strength of the firms to higher research input. Data from annual reports showed that the combined research and development (R&D) expenditure of the firms totaled 59.91 billion yuan ($8.8 billion) in 2018, up 15.69 percent year-on-year.

Their average R&D intensity, the proportion of R&D expenditure to sales revenue, stood at 3.23 percent, 1.05 percentage points higher than that of the whole society.

By the end of last year, 72 percent of the listed firms on the board were in the sectors of advanced manufacturing and modern services. The proportions of high-tech and intellectual property-intensive firms have grown to 65 percent and 42.25 percent respectively.

Founded in 2013, the NEEQ was launched to supplement the Shanghai and Shenzhen stock exchanges and is seen as a better financing channel for small- and medium-sized enterprises, with low costs and simple listing procedures.