On August 27, China's Ministry of Finance, the China Securities Regulatory Commission and the three major exchanges jointly launched a "policy combination" aimed at activating the capital market. The move includes four major measures, including the halving of stamp duty, the phased tightening of IPOs and refinancing, the regulation** and the reduction of the financing margin ratio. On November 22, the China Securities Regulatory Commission (CSRC) solicited public opinions on the "Provisions on On-site Inspection of Initial Public Offering Enterprises (Draft Revisions)" and the "Regulatory Provisions on Guidance for Initial Public Offerings** and Listings (Draft Revisions for Comments)", adding more than 10 new provisions on the basis of the 2021 version to further strengthen the idea of "declaration is responsibility".
At present, it has been more than three months since the release of the policy combination, and no matter from the perspective of the number of IPO applications accepted, registration or withdrawn, the companies to be listed have been forced to generally enter the "cooling-off period" of financing, and there are more rational observations and situation judgments on the rhythm of the impact on the capital market.
The number of IPO applications accepted and meetings has shrunk across the board
Since the second half of this year, the number of IPO recipients in Shanghai and Shenzhen has dropped significantly, and after zero acceptance in July and August, 11 new companies were finally added in September, but there were no new acceptance companies from October to November, and the situation can be described as bleak.
At the same time, IPO listings and registrations remain relatively slow. From August to November, the number of IPO companies in Shanghai and Shenzhen was 24, 17, 2 and 7 respectively, far lower than the level of the same period last year. In terms of the number of registrations, a total of 24 projects have been registered and effective, including 12 on the Main Board, 4 on the Science and Technology Innovation Board, and 8 on the Growth Enterprise Market. Compared with the current number of 244 companies queuing up on the main board, 110 on the Science and Technology Innovation Board, and 264 on the Growth Enterprise Market, if the current registration rhythm is followed,The sector with the shortest digestion period will also reach more than 4 years
Distribution of the number of newly accepted IPOs in Shanghai and Shenzhen (January 2023 - November 2023).
Note: It does not include enterprises on the Beijing Stock Exchange, including enterprises whose IPOs are terminated after acceptance, data**: wind
The number of voluntary withdrawals has increased
With the tightening of the IPO policy, companies planning to be listed are facing stricter review and approval procedures, which has led to many companies choosing to voluntarily withdraw their application materials and terminate the review after rational judgment. This phenomenon intensified in the two months following the tightening of IPOs.
As of November 30, 220 companies have terminated IPOs and withdrawn materials in 2023。Among them, since August 27, the number of enterprises that have voluntarily withdrawn materials has reached 74.
Number of entrepreneurs who withdrew from IPOs from January to November 2023.
Note: Data **wind
In terms of sub-sectors, as of November 30, a total of 129 IPOs were withdrawn from June to November, and the number of entrepreneurs withdrawn from GEM IPOs was the largest.
Note: Data **wind
Corporate financing planning is more rational and calm
The stringent review standards and the extension of the approval cycle have made IPO companies face more complex uncertainties, forcing enterprises and intermediaries to start reviewing the situation and rationally assessing whether the established listing schedule and even the listing destination can still meet the requirements of the situation. Some companies that do not have much cash flow pressure and shareholder pressure have chosen to withdraw after comprehensive judgment and report again at the right time.
During the review period, the enterprise will objectively be constrained by many IPO requirements, and the management, especially the actual controller, often cannot concentrate on business development, but needs to spend a lot of energy to deal with various IPO verification matters. Some investment bankers said that although the withdrawal has delayed the listing process, objectively, enterprises can also take advantage of this window period to concentrate more on the nature of the business, and it is no longer easy to be entangled in some business choices that need to be judged from a long-term perspective.
For example, if the investment in R&D or marketing expenses is greatly increased for the purpose of business development during the audit period, it will inevitably cause short-term fluctuations in performance during the reporting period, and the actual controller is often very hesitant. But the development window is fleeting, and I don't want to give up. After withdrawing, it is equivalent to temporarily untiring, but you can let go of your hands and feet and look at the changes in the development of the enterprise with a more long-term vision. The person said.