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Registration System Inquiry Frequent, "Group Low Price" More Than 20% GEM Companies Issue Price Less Than 23 Times PE

2020/9/15 10:14:00 0

Registration SystemInquiryGroupLow PriceIssue PricePE

The A-share issuance and underwriting market under the registration system is undergoing great changes.

Recently, the 21st century economic report reporter learned from a number of investment institutions and securities companies that, recently, many enterprises planning to IPO have encountered the situation of "group bidding for low price" in the initial inquiry stage, and some enterprises are even quoted by institutional investors who participate in the inquiry, and the price is only 2.3% off the lower limit of the investment and Research Report of securities companies.

"This phenomenon may be more serious in the future. No one has paid attention to pricing before, and it will be finished when it comes out. Investment banks are basically equivalent to clubs and law firms with a larger scale. Now (the issue of new shares is) market pricing, this will certainly happen (the quotation will be lower and lower). However, this is also related to the poor market environment recently." On September 14, a person from the investment bank department of a small-scale securities firm in South China told reporters of the 21st century economic report.

In fact, the new trend of inquiry market under the registration system can also be seen from the recent changes in the issuance price, P / E ratio and raised funds of new stocks on the science and technology innovation board and the gem. According to the statistics of 21st century economic report, the current price earnings ratio of new shares on the science and technology innovation board has declined significantly, while under the registration system of gem, more than 20% of enterprises have issued prices lower than 23 times P / E ratio.

Issue pricing cooling

With the gradual spread of the registration system in the A-share market, the inquiry and quotation in the primary market is quietly changing.

As of September 14, 34 enterprises under the registration system have completed the preliminary inquiry and determined the issuing price. However, 7 of them have a P / E ratio lower than 23 times, and 22 enterprises have a P / E ratio lower than the industry average p / E ratio.

Huiyun titanium, which has the lowest P / E ratio, has an issue price of 3.64 yuan / share and a P / E ratio of 16.12 times. In the same period, the static average p / E ratio of its industry in the latest month was 29.18 times.

The reporter noted that in the issuance stage of Huiyun titanium industry, a total of 6364 institutional investors participated in the inquiry, but 228 of them were set as "invalid quotation" because the price was too low. The 3.38 yuan quoted by Pacific assets, 3.59 yuan from Great Wall Fund, and 3.55 yuan from Huaxi Securities and Yude investment were all "excluded from the low price".

According to the public information, Huiyun titanium originally planned to raise 409 million yuan for the reconstruction and expansion project of 80000 tons / year plastic grade rutile titanium dioxide, recycling economic technology transformation project, R & D center construction project, information operation center construction project, etc., but the actual fund-raising amount of Huiyun titanium industry was lower than the expected amount Only 364 million yuan.

This is not an exception. According to the statistics of 21st century economic report, among the 34 enterprises registered on the growth enterprise market, 11 enterprises actually raise less capital than they plan to raise, which means that less than 2 / 3 of the enterprises have excessive fund-raising. A typical example is Shengyuan environmental protection. The company originally planned to raise 1.866 billion yuan, but the actual amount raised was 1.315 billion yuan. The company's issuing P / E ratio was 24.37 times, which was slightly lower than the industry average p / E ratio of 25.47 times in the same period.

"The P / E ratio is not high, (less raised funds lead to) less underwriting fees, but forced investment banks to find large-scale enterprises, small enterprises can not earn money." September 14, another medium-sized securities firm in South China Investment Banking Department said.

In fact, in the science and technology innovation board market, the change trend of inquiry is more obvious. In the past 20 days (August 24 to date), the issuing price of new shares on the science and technology innovation board has also dropped significantly.

According to the wind data, the 21st century economic report found that from January to August 2020, there were 90 new stocks listed on the science and technology innovation board, excluding 13 unprofitable stocks. The average price earnings ratio of other new shares listed on the science and technology innovation board was about 81 times, of which the highest price earnings ratio of Funeng technology was 1737.49 times. The price to earnings ratio of Shengxiang biological was 536.30 times, which was much higher than 57.74 times of the industry average in the same period. The net amount of funds raised was 1.313 billion yuan more than the original plan.

However, among the enterprises listed in September or not yet listed but with fixed issuing price, the average p / E ratio of 13 enterprises is only 65.77 times. Among them, the actual fund raised by 4 enterprises is lower than the expected amount, accounting for more than 30%. Among the four enterprises, three enterprises with insufficient fund-raising were all enterprises that started issuing after September 10.

The most typical prebiotics company started to apply on September 11, with the price of 11.69 yuan and the price earnings ratio of 26.23 times, which is 56.33 times lower than the average price earnings ratio of the industry. The company originally planned to raise 1.833 billion yuan, but the actual fund-raising was about 30% less than the planned fund-raising, only 1.227 billion yuan.

In the inquiry process of keqianbio, 6306 institutional investors participated, but 272 of them were not shortlisted due to their low price, including 11.50 yuan from China Shipping fund, 11.68 yuan from Xingzheng global and industrial fund, etc., which were all eliminated.

In addition, Lutheran's original plans of raising $382 million and $365 million were not realized.

The phenomenon of "offering low price" in institutional disputes

In fact, on the other side of the cooling down of the issuance and underwriting market, the breaking of some new shares is also the main reason for the institutions to make cautious moves.

The reporter noted that as of September 14, among the new shares listed since 2020, the closing price of three stocks was lower than the issue price, namely, Ruilian new material, spatiotemporal technology and casai bio, and the three stocks were listed and traded for less than 30 days.

Last week, the gem ushered in a number of new shares with registration system breaking. First, Fengshang culture, one of the "18 Arhats" listed on the gem on September 9 and August 24, fell below the issuing price of 138.02 yuan. The next day, Meichang shares fell below the issue price of 43.76 yuan on September 10, becoming the second registered new shares to be broken.

Although the growth enterprise market rebounded on the 14th, the closing price of the above-mentioned stocks has returned to above the issue price, but it is not far away from breaking.

On September 11, more sources pointed out that institutional investors participating in the inquiry under the registration system of the science and technology innovation board and the growth enterprise market reported a 2.3% discount of the lower price limit of the Investment Research Report of securities companies for the IPO price. So far, the reporter of the 21st century economic report has not confirmed the relevant personnel, but one sign has aroused market alarm.

Some market participants questioned that some institutional investors who participated in the inquiry had the situation of "no discrimination, simply pushing down the price", and questioned that the existing inquiry pricing mechanism was unreasonable. They pointed out that "the current system requires 10% of the highest quotation to be removed, but the lowest 10% is not required to be removed, and there is no mechanism for rejecting scrapped orders (i.e. significantly lower fault orders), which makes the pricing center single direction It's going down. ".

However, the reporter learned that many market participants believed that the change of inquiry market was the result of free choice of funds.

Wang Jiyue, a former senior investment banker, pointed out that "it is normal for someone to follow suit and quote, and not all institutions have the ability to quote". However, "different issuers and different underwriters have different discounts, which means that there is not a unified discount, but a differentiated pricing. At most, it is said that someone is leading the pricing.".

In Wang Jiyue's view, "in the pricing mechanism, if you quote a low price, you can't get tickets, and you can't earn money for new shares. It's meaningful to report above the average price. This proportion is higher than 10% of the price. Unless the higher price is obtained, it will be ranked from top to bottom according to the fixed subscription multiple, or even if 10% is not removed, there will be no change."

On September 14, the chief investment officer of a large private equity firm in South China also said: "it is a good rule to strike new" high tick (i.e. eliminate those with more than 10% quotation) "off-line, which prevents excessive inquiry from damaging the secondary market. After such a long time of participation, the market has indeed formed a trend of gradually downward inquiry, but the downward inquiry trend is caused by several aspects, one is related to the "high tick" and the other is related to the performance of new shares. "

The chief investment officer added: "this is a game process between the primary and secondary markets. I think the most important thing is to improve the fairness of the investment report issued by the sponsor securities companies. If the market price performs well, the valuation given in the report is not so reasonable. What we can see now is that the inquiry is lower and lower, and there is a 20% discount on the basis of the investment report. Before that, some enterprises broke their shares when they were listed on the stock market, while the enterprises on the growth enterprise market did not have to follow the investment. The securities companies certainly want to pay high prices. Therefore, how to ensure the independence of the bidding report is a problem that needs to be paid attention to by the regulatory authorities. "

It is worth mentioning that in view of the dispute in the current inquiry market, there is a certain game space in the issuance rules.

According to the relevant provisions of the measures for the administration of securities issuance and underwriting: "in addition to the suspension of issuance as stipulated in these measures, the issuer and the lead underwriter may also agree on other specific circumstances of suspension of issuance and disclose them in advance. After the suspension of the issuance, within the validity period of the approval documents, the issuance may be restarted upon filing with the CSRC. "

Wang Jizi and the underwriter may terminate the agreement in advance. In other words, it can be agreed in advance that it will not be issued if it is lower than a certain price, but it should be announced. We can't say that we don't accept the inquiry result. The reserve price can be disclosed in advance "," the seller is allowed to suspend the issue without accepting the inquiry result, and the company can start the business at an appropriate time within the validity period of the approval document. "

 

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