On May 4, the China Securities Regulatory Commission surprised many people by approving the initial public offering of Shanghai-based Yaoji Poker Co, which makes playing cards.

The company wants to raise 362 million yuan (US$55.7 million) by issuing 23.5 million shares on the Small and Medium Enterprise (SME) board in Shenzhen, an exchange that is supposed to provide a funding channel for promising companies with high-growth potential.

According to the prospectus, Yaoji wants to use the money to build a manufacturing base with a designed annual capacity of 600 million decks of card. That would raise the company's annual output to 1.3 billion decks - one for every man, woman and child in China.

Eyebrows were raised for several reasons.

Some critics said a playing card company doesn't reflect the aims of the SME, which is to encourage the development of advanced technology. Others cast a dubious eye at Yaoji itself, saying the company is really more interested in real estate development than in card games.

Still others heaped scorn on the decision because they equate playing cards with gambling and see the IPO as a back-door invitation to the spread of something currently banned as a vice in China.

Of course, playing cards are used in all sorts of games, poker included. And small antes aren't all that uncommon in friendly local neighborhood games. The police seem to take a dim view of gambling only when it involves large sums of money or the involvement of dubious organizations.

All that said, one wonders just how many decks of cards are needed in China.

Last year, Yaoji made 700 million decks. Ningbo Three A Group Co turned out 500 million decks. Zhejiang Wanshengda Industry Co produced 350 million, Zhejiang Bingwang Playing Cards Co and Zhejiang Wuyi Fishing Industry Co each manufactured 300 million, and Jiangsu Santu Economic & Trade Development Group Co, 200 million.

Add them up! In one year alone, 2.35 billion decks of cards were made. Playing cards don't wear out that fast! Yaoji last year had 120 million cards unsold stored in inventory.

Lou Qin, general manager of Zhejiang Bingwang, told China Business News that the playing card market is saturated and there isn't much potential in the export market.

As online entertainment replaces pastimes like card games, especially among the younger generation, you have to wonder who is going to buy all these decks of cards or why Yaoji needs a new and bigger manufacturing facility.

An Internet user whose online name is Zhongzhengying called the approval of Yaoji Poker's IPO "ridiculous," noting that government policy is to foster the development of industries that use advanced technology, seek environmentally friendly solutions or provide needed jobs in sectors that will help China's economy mature.

Other Internet users said they suspect that a listed company like Yaoji will spur underground gambling. Some asked sarcastically: "Will a mah-jong maker be next?"

In a survey on Sina.com, 88 percent of 16,958 respondents said they oppose Yaoji's IPO.

The CSRC, a seven-member panel, didn't see it that way. The problem is that many investors are scratching their heads trying to figure out how the CSRC saw it.

Media reports subsequently revealed that Yao Wenchen, founder of Yaoji Poker, doesn't seem very interested in poker or any card games, for that matter. His full house is real estate.

Yao has two real estate companies in Nantong and Qidong, two small cities in Jiangsu Province, both within an hour's drive of Shanghai.

From 2005 to 2007, Yao's real estate companies bought three sites totaling nearly 760,000 square meters in Qidong for 40 million yuan, or 55 yuan a square meter.

In 2009, the land was valued at 750.16 yuan per square meter, according to Jiangsu's provincial land transaction website.