The number of the first batch of listed companies on the Beijing Stock Exchange is expected to be no less than 80, and with the development of the Market on the Beijing Stock Exchange, the investment banking pattern may change again
Text | Liu Zonggen
Edit | Lu Ling
On the evening of November 10, the national stock transfer system showed that ten selected new stocks collectively disclosed the announcement of the public offering of shares to unspecified qualified investors and listing on the Beijing Stock Exchange on November 15, which is believed to mean that the Beijing Stock Exchange will officially open on the same day.
The above ten selected new stocks are Dadi Electric, Hanxin Technology, Zhongshi Consulting, Zhisheng Information, Zhonghuan Shares, Guangdao High-tech, Tongxin Transmission, Jingsai Technology, Keda Automation and Henghe Shares, covering automobile manufacturing, software and information technology services, and instrumentation manufacturing and other industries.
Preparations for the opening of the Beijing Stock Exchange have gradually come to an end. On October 30, the China Securities Regulatory Commission (CSRC) issued three regulations on the issuance, listing, refinancing and continuous supervision of the Beijing Stock Exchange and 11 related normative documents; at the same time, in order to do a good job in system convergence and enrich the financing tools of the national stock transfer system, it revised two regulations on the supervision of unlisted public companies and formulated two content and format guidelines for the targeted issuance of convertible bonds by listed companies.
Subsequently, on November 2, the Beijing Stock Exchange officially issued two basic business rules and 31 detailed guidelines for the trading rules of the Beijing Stock Exchange (trial) and the rules for the management of members of the Beijing Stock Exchange (trial). On September 17, the Beijing Stock Exchange issued the Measures for the Administration of Investor Appropriateness of the Beijing Stock Exchange (Trial Implementation) and Supporting Business Guidelines, and on October 30, it issued 4 basic business rules for listing and review and 6 supporting rules and guidelines. So far, all 7 basic business rules of the Beijing Stock Exchange have been released.
From the overall market situation, there are currently 7172 companies listed on the New Third Board, including 71 companies listed on the selected layer, 1239 companies listed in the innovation layer and 5862 listed companies on the basic layer. The establishment of the Beijing Stock Exchange announced that there were 66 listed companies in the former selection layer, and in the past month, 5 companies, including Jinhao Medical, Guangzhi International, Haixi Communications, Guangmai Technology and Hechang Aggregation, have completed the listing of the selected layer. Since the selected layer of the New Third Board has shifted to the Beijing Stock Exchange, the number of the first batch of listed companies on the Beijing Stock Exchange is expected to be no less than 81.
In addition, Yoshioka Precision, another new stock in the selected layer of the New Third Board, which is in the process of being issued, has not yet disclosed the listing announcement of the Beijing Stock Exchange. On October 29, Yoshioka Precision issued the announcement that the shares of Wuxi Yoshioka Precision Technology Co., Ltd. were publicly issued to unspecified qualified investors and listed on the selected layer. Yoshioka Precision pricing is direct pricing, the issue price is 10.50 yuan, and the subscription date is November 3.
Raised around 150 million yuan
The first batch of announcements on the Listing of the Beijing Stock Exchange includes important statements and reminders, stock listings, shareholdings held by issuers and actual controllers and shareholders, stock issuance, other important matters, and sponsor institutions and their opinions. Compared with the Shanghai and Shenzhen exchanges, the listing announcement of the Beijing Stock Exchange is not complicated.
In terms of listing standards, almost all of the above ten selected new stocks have chosen the first set of listing standards. The first set of indicators of the Rules Governing the Listing of Stocks on the Beijing Stock Exchange (Trial) is that the expected market value is not less than 200 million yuan, the net profit in the last two years is not less than 15 million yuan and the weighted average return on net assets is not less than 8%, or the net profit in the latest year is not less than 25 million yuan and the weighted average return on net assets is not less than 8%.
The "Caijing" reporter learned that the first batch of listing announcements on the Beijing Stock Exchange showed that the total amount of funds raised by the above ten selected new stocks was not high, and most of them were around 150 million yuan. Among them, the total amount of funds raised by Hanxin Technology in this new share issuance was 141 million yuan, the total amount of funds raised by Dadi Electric's new share issuance was 156 million yuan, and the total amount of funds raised by Zhonghuan Shares' new shares was 114 million yuan.
According to the Measures for the Administration of Investor Appropriateness of the Beijing Stock Exchange (trial implementation), individual investors participating in stock trading on the Beijing Stock Exchange market should meet the following conditions, one is that the assets in the securities account and the capital account in the 20 trading days before the application for permission are opened are not less than 500,000 yuan per day, excluding the funds and securities that the investor has integrated through margin financing; the second is to participate in securities trading for more than 24 months. In addition, institutional investors participating in the stock trading of the Beijing Stock Exchange shall comply with the provisions of laws and regulations and the business rules of the Beijing Stock Exchange.
Zhu Haibin, chief analyst of the new third board of Anxin Securities, believes that the current public funds are actively laying out the Beijing Stock Exchange. Recently, 8 public funds have reported innovative products invested in the Market of the Beijing Stock Exchange, and the fund products reported are all mixed funds that are regularly opened for two years. As of October 28, there are 31 public fund products that can be invested in the New Third Board, from 13 fund companies.
On the other hand, the listing announcement of the Beijing Stock Exchange reminds the transaction risks, for example, there is no limit on the rise and fall of the first day of the listing transaction on the Beijing Stock Exchange, and the subsequent limit on the rise and fall is 30%, and the stock price fluctuation range is not small, and there is no small trading risk.
According to the trading rules of the Beijing Stock Exchange (trial implementation), the trading methods that can be adopted for stocks on the Beijing Stock Exchange include auction trading, block trading and after-hours fixed price trading. In addition, during the opening collective auction period from 9:15 to 9:25 and the closing collective auction from 14:57 to 15:00 on each trading day, the real-time market content includes the securities code, the abbreviation of the securities, the previous closing price, the reference price of the collective auction, and the matching and unmatched amount; if the collection auction reference price is not generated, the real-time optimal 1 file declaration price and quantity are revealed.
On November 5, the National Stock Transfer Company, the Beijing Stock Exchange and the Industrial and Commercial Bank of China signed a strategic cooperation agreement. According to the strategic cooperation agreement, the three parties will further strengthen communication and exchanges, cooperate in comprehensive financial services, listing and cultivation, corporate credit financing, product investment, innovative research, science and technology finance and information sharing, and establish a normalized bilateral exchange mechanism.
Yi Huiman, chairman of the China Securities Regulatory Commission, said at the annual meeting of the 2021 Financial Street Forum in October this year that the Beijing Stock Exchange is the "leader", and the innovation layer and the basic layer of the New Third Board are the foundation, and it is necessary to give full play to the leading role of the Beijing Stock Exchange in leveraging and feeding back, and constantly do a better job of strengthening the innovation layer and the basic layer. At the same time, we will strengthen the interconnection with the Shanghai and Shenzhen exchanges and regional equity markets, accelerate the improvement of the whole chain system for serving small and medium-sized enterprises, and form a progressive growth path for small and medium-sized enterprises and a good multi-level market development ecology.
Differentiated competitive opportunities
The underwriting pattern of the New Third Board is different from that of the Shanghai and Shenzhen exchanges, and the Beijing Stock Exchange continues this trend. From the perspective of underwriters, except for Keda Self-Control and Henghe Shares, the sponsoring institution of Henghe Shares is CITIC Construction Investment, and most of the rest belong to small and medium-sized securities companies. The sponsoring institution of Dadi Electric is Northeast Securities, the consulting sponsor of Zhongzhi is Galaxy Securities, the sponsoring institution of Zhonghuan Shares is Anxin Securities, and the sponsoring institution of Tongxin Transmission is Kaiyuan Securities. In addition, Zhisheng Information's co-lead underwriters are Zhongtai Securities and Pacific Securities.
According to the Detailed Rules for the Administration of Securities Issuance and Listing Sponsorship Business on the Beijing Stock Exchange, sponsoring institutions recommending issuers to issue securities should submit to the Beijing Stock Exchange a letter of sponsorship, a special authorization letter for the sponsor representative, and other documents related to the sponsorship business required by the CSRC and the Beijing Stock Exchange. The issuance of a letter of sponsorship shall include an item-by-item explanation of whether the offering complies with the issuance conditions and procedures stipulated in the Company Law and the Securities Law; the main risks of the issuer; and a brief introduction to the internal audit procedures and core opinions of the sponsoring institution.
In addition, the sponsoring institution and the sponsoring representative shall supervise the listed company to establish, improve and effectively implement the information disclosure system, review the information disclosure documents and other relevant documents in a timely manner, and have sufficient reasons to believe that the documents submitted by the listed company to the Beijing Stock Exchange do not contain false records, misleading statements or material omissions.
Shi Donghui, a professor at the Oceanwide School of International Finance of Fudan University, believes that with the development of the market on the Beijing Stock Exchange, it is expected that the investment banking pattern will change again. The issuance business of Shanghai and Shenzhen has long been occupied by first-line securities companies, and the market share of the so-called "three in one China" is increasing. However, the situation of the new third board is different, on the whole, the business volume of small and medium-sized securities companies is relatively dominant, and the establishment of the Beijing Stock Exchange will provide opportunities for differentiated competition, and small and medium-sized investment banks are expected to transform into boutique investment banks focusing on a certain industry, a certain region and a certain type of service.
In June this year, the Securities Association of China conducted a statistical ranking of 38 indicators such as the asset size of securities companies based on the audited data of securities companies, and released the ranking of the operating performance indicators of securities companies in 2020. Among them, the investment banking business income of the securities industry in 2020 reached 67.067 billion yuan, an increase of 39.76% year-on-year, accounting for 15.25% of the operating income. In terms of the investment banking business income ranking of securities companies in 2020, the top five are CITIC Construction Investment, CITIC Securities, CICC, Haitong Securities and Huatai Securities. Kaiyuan Securities and Essence Securities are located in about 20.
Shi Donghui believes that the competition of investment banking business will be pre-positioned, from the project "hunting" model to the "animal husbandry" model that accompanies the growth of enterprises, and strive to select high-quality entrepreneurs and start-ups in the early stage and establish close ties with them, so as to facilitate the provision of financial services throughout the life cycle of enterprises.
Xu Ming, chairman of the Beijing Stock Exchange, said at the annual meeting of the 2021 Financial Street Forum in October this year that the main position should be built from the financing end and investment and financing, and give full play to the important role of intermediary institutions in communicating between investment and financing. Strengthen the reform of the financing end, vigorously promote the innovation of financing tools, improve the issuance and underwriting system, continuously improve the transparency and predictability of review and registration, deepen the differentiated arrangements for information disclosure, and enhance the pertinence and effectiveness of information disclosure.
Regarding the reform of the registration system, Yi Huiman said that the CSRC has always emphasized that the registration system does not mean relaxing the review requirements, and must strictly control the truthfulness, accuracy and integrity of information disclosure, and improve the quality of listed companies from the source; always emphasize the need to urge intermediary institutions to improve their ability to perform their duties; and always emphasize the appropriate balance of the primary and secondary markets.
At the same time, he said that the sci-tech innovation board and the ChiNext board have taken the initiative to withdraw 245 enterprises, many of which are because of plate positioning problems, which exposes the gap between some sponsoring institutions in the concept of development, policy grasp and internal control, one-sided pursuit of quantity and scale, quality control can not keep up. It is hoped that sponsoring institutions will work in the same direction as regulatory authorities and exchanges to continuously improve the level of internal governance and policy implementation.