IPO inquiry is more market-oriented, and the pricing of many new stocks has broken through the "four values are low"

Source: Shanghai Securities News

The implementation of the new IPO inquiry rules under the registration system has been implemented for more than a month, and the pricing and inquiry of new shares on the ChiNext board and the science and technology innovation board have also undergone positive changes under the guidance of the new regulations. After combing the data, the reporter of Shanghai Securities News found that the effective quotation range under the new regulations on inquiry has been significantly expanded, and the pricing of many new stocks has broken through the "four values are low", and the pricing of IPO issuance has become more market-oriented.

Judging from the institutional quotation situation, after the new regulations on inquiry are landed, the buyer's "group quotation" situation has been effectively curbed. Before the rule adjustment, the highest and lowest prices of the registration-based IPO inquiry quotations were often only a few minutes apart. According to the research data of CITIC Securities, before the revision of the rules, the effective quotation range width centers of the Science and Technology Innovation Board and the ChiNext Board were 0.4% and 0.6% respectively. After the new rules for inquiry were landed, the quotations were more dispersed, and the effective quotation range width center of the science and technology innovation board and the ChiNext board was expanded to 20.3% and 16.9% respectively.

Overall, the revision of the inquiry rules mainly revolves around the "four-value constraint" in the pricing of new shares. The so-called "four-value constraint" refers to the issue price determined by the issuer and the lead underwriter in the inquiry that exceeds the median and weighted average of the offline investors' quotations after excluding the highest quotation, and the median and weighted average of the quotations of public funds, social security funds, pensions, enterprise annuities funds and insurance funds after excluding the highest quotations, and it is necessary to issue different numbers of risk warning announcements according to the exceeding range. Before the rule adjustment, the vast majority of registered companies were priced at a price slightly lower than the "four values".

The new rules of the registration system for inquiry are clear, and if the issue price exceeds the average quotation of offline investors, only one special announcement of investment risk needs to be issued before the subscription, and there is no need to delay the subscription. According to the statistics of Shanghai Securities News, under the new regulations, the issue price of 7 new shares such as high-speed rail electric, Yum intelligence, Jiusheng electric, Kefu medical, Zhongke Weizhi, Rongmei shares, and Shenzhen City Exchange has exceeded the low value of "four values". From the perspective of the excess, the pricing of the above 7 new stocks exceeded the "four values" by 1.13%, 3.7%, 5.52%, 0.07%, 4.08%, 4.83% and 7.27% respectively.

"The magnitude of the excess is on the rise, which reflects that the lead underwriter is actively exercising its own pricing power." Some senior investment bankers said that this is also the embodiment of market-oriented pricing, and it is expected that more new stock pricing will break through the "four values are low" in the future.

After the pricing center rises, can the new one still make a steady profit? Wang Zhengzhi, chief analyst of Guotai Junan Research Institute, said that after the new rules of inquiry are landed, it is expected that the valuation of new stock issuance will move up rapidly, and the increase after listing will narrow, and the new income in the next year may decline.

Wang Zhengzhi believes that under the original inquiry system, "high price excluded 10%" and "four value constraints" are priced to ensure that new stocks are undefeated. The new rules reduce the proportion of high price exclusion from the original "10%" to "3%", while simplifying the issuance process when breaking through the "four values are low" pricing. These two amendments have shifted the pricing power of IPO shares from the original buyer's market to the seller, and the phenomenon of insufficient capital raised by enterprises has been alleviated. For new investors, we need to be wary of the narrowing of the growth rate of new stock listings and even the occurrence of a break.

At present, among the above 7 new stocks, high-speed rail electric and Yum Intelligent have been listed, and the latest stock prices of the two have increased by 36.8% and 85.9% respectively compared with the issue price.

Reporter Xu Wei Editor Sun Fang