As of May 19, 144 companies have terminated (withdrawn) their IPOs since this year, far exceeding the number in the same period last year. At the same time, the pass rate of audit and the amount of initial fundraising decreased, and the pace of issuance slowed down significantly. The above situation sends the latest signal that the regulatory authorities strictly control the access to issuance and listing and tighten the IPO rhythm in stages.
The market personage interviewed by the reporter of China Securities Journal believed that the regulatory authorities strictly controlled the IPO access and the new share issuance market ecology continued to optimize, which was highlighted in the difficulty of IPO over offering and the fact that institutions tended to sponsor high-quality projects with strong scientific and technological attributes. The regulatory authorities will further control the access to issuance and listing, and force enterprises and intermediaries to be listed to improve the quality of application.
Implement the requirements of the new "National Ninth Article"
The Shenzhen Stock Exchange Shanghai Municipal Committee held a meeting on May 16 to review Marco Polo's initial listing application and made a decision to suspend the review, which attracted market attention. This is also the first review meeting of the Listing Committee held after the issuance of the new "National Ninth Article" and supporting policy documents.
"The municipal party committee postponed the review of Marco Polo's listing application this time, mainly considering the actual situation that the company's operating income and profit had declined to a certain extent during the reporting period, and it is necessary to further confirm whether the uncertainties affecting performance have been eliminated on the existing basis." The relevant person in charge of Shenzhen Stock Exchange said.
Market participants believe that this not only reflects the practical attitude of the Exchange to seek truth from facts and treat enterprise issuance applications objectively, but also shows the firm determination of the Exchange to conscientiously implement the new "National Nine Articles", strictly control the issuance access according to law, improve the quality of listed companies from the source, and better protect the legitimate rights and interests of investors.
In the context of improving the quality of listed companies from the source, institutions are more inclined to choose projects with strong scientific and technological attributes and embracing new quality productivity.
An investment banker told the reporter: "Since this year, the scientific and technological innovation of IPO, refinancing and other services has been relatively improved, and many cutting-edge technology enterprises have received key financial support from the capital market. When selecting projects to be IPO, we prefer to choose projects with strong scientific and technological attributes and actively embrace new quality productivity. These projects are expected to enter the new track of IPO normalization."
Continuous optimization of issuance ecology
Under strict supervision, the ecology of the IPO market continued to optimize. Among them, the number of IPO voluntary withdrawals is increasing, and the phenomenon of over offering is difficult to find.
Wind data shows that as of May 19, 144 companies have terminated (withdrawn) their IPOs this year, including 47 Shanghai and Shenzhen main board companies, 21 science and technology innovation boards, 38 growth enterprise boards, and 38 Beijing Stock Exchange.
As the signal of strict IPO regulation continues to be released, many enterprises choose to voluntarily withdraw their listing applications, including some enterprises that have passed the meeting. For example, the Shenzhen Stock Exchange announced on May 13 that because Jingqi Network submitted an application to withdraw relevant listing documents with the sponsor during the CSRC's review of its IPO and GEM listing application documents, the CSRC decided to terminate the registration procedure for Jingqi Network's issuance in accordance with relevant regulations and provisions. Earlier, the company had passed the review of the municipal party committee.
"Looking at the reasons for cancellation, the financial data disclosed by some enterprises to be IPO failed to meet the new IPO regulations." Zhang Cuixia, chief investment adviser of Jufeng Investment, said that the relevant departments recently improved the listing standards of the main board and GEM, improved the evaluation standards of the sci-tech innovation attribute of the sci-tech innovation board, and raised the threshold for listing. There are also some enterprises that plan to IPO or touch the "red line" of the new IPO policy, for example, they do not conform to the plate positioning, and there are sudden "clearance" dividends.
While the number of cancellations is increasing, it is difficult to find the phenomenon of IPO over raising. According to Wind data, as of May 19, a total of 37 new shares had been listed this year, with an average P/E ratio of 23.42 times, significantly lower than that of the same period last year.
"The regulatory authorities have recently strengthened the supervision of issuance and underwriting, strengthened the supervision of all aspects of the inquiry, pricing and placement of new shares, remedied the market chaos such as high price over offering and price holding, and improved the sense of gain of small and medium-sized investors," said Liu Chen, a researcher at the Bank of China Research Institute.
Strict supervision will increase
From the policy signals released by the regulatory authorities, IPO regulation will be increased again.
On the one hand, the CSRC strengthened the behavioral constraints of enterprises to be listed. On May 15, the CSRC issued the Guidelines for the Application of Regulatory Rules - Issuance No. 10, which put forward many new requirements for issuers, including requiring issuers to publish statements to investors in the prospectus, and strengthening the awareness of "key minorities" sharing risks with investors, Strengthen the information disclosure of unprofitable enterprises.
"While preventing enterprises from blindly seeking listing for the purpose of 'circling money', these measures also reflect the concept of being responsible for investors, and help to truly find high-quality enterprises with innovative ability and long-term development value, and effectively play the role of capital market in serving the innovative development of technology enterprises." Tian Xuan, vice president of Wudaokou School of Finance, Tsinghua University, said.
On the other hand, to improve the quality of listed companies from the source, the CSRC recently re emphasized that "reporting is responsible".
"Issuers, intermediaries, etc. will all face a more stringent regulatory environment." Zhao Xijun, co president of the China Capital Market Research Institute of Renmin University of China, said that the regulatory authorities recently made it clear that they would significantly increase the proportion of on-site inspections, expand coverage, and severely punish the clues of fraudulent issuance and financial fraud found in on-site inspections once verified, Will significantly improve the effectiveness of the issuance and listing supervision. It can also be seen from the recent fines issued by the regulatory authorities that "one supervisor will withdraw", "crossing the border with illness" and other behaviors will be severely punished.
Zhao Xijun further reminded that first movers should establish a sense of integrity and self-discipline, and intermediaries should also be diligent and responsible to improve the quality of listed companies from the source.
