Investor.com" Ye Xin.
In 2023, the A-share IPO market will be changing.
In February 2023, the capital market ushered in a comprehensive registration system, and the market tolerance was significantly improved; Entering the second half of 2023, with the decline of A-shares** and the sluggish market sentiment, the pace of IPO issuance has been tightened in stages.
In 2023, the number of IPOs and the scale of fundraising will hit a new low in the past three years. According to statistics, in 2023, a total of 299 companies will attend the meeting (enterprises that have been canceled before the meeting will not be counted), a total of 279 will pass the meeting, another 12 will be rejected, 4 will be suspended, and 4 will be withdrawn after being suspended, with a passing rate of 9331%。
In 2023, when the whole chain of the IPO market is tightening, IPO projects will be strictly reviewed, and the number of cancellations will also hit the largest wave of withdrawals in the past decade. According to the data, in 2023, a total of 284 companies withdrew their IPO applications or were not approved by the Listing Committee meeting (hereinafter referred to as "withdrawn enterprises"). This figure is slightly higher than the number of companies that passed the meeting for the whole year (279). Among them, the number of withdrawn enterprises in the second half of the year was 163, accounting for 574%, significantly higher than the 121 in the first half of the year. Historically, the last peak of IPO withdrawals occurred in 2013, when a total of 276 IPOs were withdrawn.
According to the data, among the 284 enterprises that will be withdrawn in 2023, the number of computer, communication and other electronic equipment manufacturing enterprises is the largest, reaching 51. Chip companies are concentrated in this industry. There are many cases of termination of chip IPOs, what are the main reasons for "canceling orders" on the way to apply for listing? Under the current capital market situation, what are the advantages of chip companies that have been successfully listed in the past year?
IPO termination events are frequent
In 2023, the A-share IPO policy will be tightened, the pace of issuance will slow down, the review of IPO projects will become more stringent, and the number of companies voluntarily withdrawing IPO applications will also hit a record high.
On-site inspection and on-site supervision are also an important reason for the voluntary withdrawal of the declared project due to the deterrent effect of the proposed IPO project. According to statistics, from 2021 to 2022, the China Securities Regulatory Commission and its dispatched agencies and exchanges conducted a total of 9 rounds of on-site inspections and spot checks, with a total of about 80 IPO companies, of which more than 40 companies terminated their audits, and the project withdrawal rate exceeded 50%.
In terms of the 284 companies that will withdraw their rejections in 2023, the withdrawal rate of the Shanghai Main Board is 42%, that of the Shenzhen Main Board is 56%, that of the Science and Technology Innovation Board is 66%, that of the Growth Enterprise Market is 51%, and that of the Beijing Stock Exchange is 41%. It's not hard to see. The STAR Market has the highest rejection rate.
From the perspective of industries, among the withdrawn enterprises, the number of computer, communication and other electronic equipment manufacturing enterprises is the largest, reaching 51. Chip companies are concentrated in this classification. According to incomplete statistics, chip IPO companies such as Xylon Technology, Yutai Co., Ltd., Ruichengxin Microelectronics, Chipone North, Xinwei Electronics, Saizhuo Electronics, and Silicon Power have voluntarily withdrawn their IPO material applications in 2023.
Judging from the replies to the inquiry, most companies voluntarily withdrew their IPO applications after being questioned by the exchange for the second round. Among them, Chipone did not reply to the first round of inquiry letters until the withdrawal of the IPO. According to the relevant progress, on June 30, 2022, the Shanghai Stock Exchange officially accepted the IPO application of Chipone North's Science and Technology Innovation Board. On July 23 of that year, it was displayed as "inquired". By the end of September 2022, due to the resubmission of financial information, the IPO of Chipone was temporarily suspended, and resumed in November 2022. Until March 14, 2023, after 9 months of waiting, Chipone took the initiative to withdraw the application for listing materials, ending the road to IPO on the Science and Technology Innovation Board.
There are several main categories of reasons for IPO termination
According to statistics, the regulatory authorities' inquiries about the proposed IPO projects mainly include abnormal fluctuations in gross profit margins, doubts about sustained profitability, sector positioning (hard technology and scientific and technological innovation attributes, three innovations and four innovations, etc.), business income sustainability, sales model, customers and businessmen, industry competition pattern and core competitiveness, core technology, rationality of fundraising and investment projects, compliance management, company valuation, etc.
Here's an example. The IPO of Saizhuo Electronics, which was accepted on December 28, 2022, went through the first round of inquiries on January 15, 2023, and disclosed the response to the first round of inquiries on April 21, 2023, but then voluntarily terminated the IPO application on July 20, 2023. According to the data, the main business products of Saizo Electronics are magnetic sensor chips, including speed sensor chips, position sensor chips, and current sensor chips, which are mainly used in automotive electronics and industrial fields.
In the first round of inquiries of SAZO Electronics, the regulatory authorities inquired about 13 categories of questions, including products and markets, technology, sales models and customers, revenue, costs and gross margins, historical evolution and shareholders, period expenses, accounts receivable and notes receivable, procurement and inventory, equity incentives, subsidiaries, fundraising projects, information disclosure, senior executives, and other questions. After more than 330 pages of responses to the first round of inquiries, Saizo Electronics voluntarily withdrew its IPO application three months later.
Regulatory authorities are becoming stricter in reviewing IPO projects, and if enterprises cannot submit satisfactory responses to several rounds of inquiries from the regulatory authorities, they will usually withdraw voluntarily; Some companies that are lucky may also expose their problems during on-site inspections.
According to the regulatory letter of the Shenzhen Stock Exchange, Xin Microelectronics, which will cancel the order in 2023, has deleted the computer log of the ERP information system after being selected for on-site inspection, and has not actively cooperated with the on-site inspection. In addition to deleting the operation log of the ERP information system, during the on-site inspection, the regulator also found several other violations of the company, including the inconsistency between the revenue recognition policy actually implemented by the company and the disclosure in the prospectus, the failure to fully disclose the imminent expiration of the core patent, the risk of the utility model patent being invalidated, and the failure to fully disclose the irregularity of financial accounting.
According to the current listing regulatory rules, companies that voluntarily apply for termination of their IPOs can sprint to list again after 6 months; If the IPO application is rejected by the regulatory authorities after review, there are generally two ways to deal with it: first, if the enterprise is not rejected due to fraud, then after obtaining the approval issued by the CSRC not approving the issuance and listing, the enterprise can choose to re-apply after 6 months; Second, if the enterprise is rejected because of fraud, it will take 36 months to re-declare according to the regulations. During these 36 months, companies are also not allowed to go public through backdoor listings.
The performance of listed companies has "changed face".
The A-share IPO market is showing signs of further slowing down, and the pace of new listings has slowed down significantly.
According to the data, a total of 313 new companies will be issued and listed in the A-share IPO market in 2023, a year-on-year decrease of 2687%, the first decline since the pilot registration system in 2018; The actual fundraising has reached 35653.9 billion yuan, a year-on-year decrease of 3925%。
The phased tightening of the IPO rhythm is an arrangement to maintain the steady operation of the market. Some analysts have pointed out that scientifically and reasonably maintaining the normalization of IPOs and coordinating the dynamic balance of the primary and secondary markets has been a long-term goal of the regulatory authorities. Under the current circumstances, the phased tightening of IPOs is conducive to reducing market financing pressure and helping the secondary market to operate steadily.
The IPO of the chip industry in 2023 will inevitably be affected by the environment. Wind data shows that there will be 5 chip companies listed in 2023, namely Nanxin Technology (688484SH), Huahong Company (688347SH), Blue Arrow Electronics (301348SZ), Telink Micro (688591SH), Centec Communications-U (688702SH), the listing dates are April 7, August 7, August 10, August 25, and September 14, 2023, respectively.
From the perspective of performance, sustained profitability is still a problem. In the first three quarters of 2023, the net profit attributable to the parent company of Nanxin Technology, Huahong Company, and Blue Arrow Electronics all declined, and the net profit attributable to the parent company was 04.9 billion yuan, 168.5 billion yuan, 1800 million yuan, a year-on-year change of -1199%、-11.61%、-26.72%；Telink Micro and Centec Communications respectively achieved a net profit attributable to the parent company of 04.3 billion yuan, 03.8 billion yuan, a year-on-year increase85%。
In fact, in the first three quarters of the first half of 2023, the performance of A-share chip companies generally declined. Wind data shows that among the 97 listed companies in the chip sector, a total of 65 companies have experienced a decline in net profit attributable to their parent companies, accounting for about 67%.
In addition, of the 5 chip companies listed in 2023, except for Blue Arrow Electronics, the current stock prices of the remaining 4 companies are already lower than the issue price. Wind data shows that as of January 29**, the share prices of Nanxin Technology, Huahong Company, Blue Arrow Electronics, Telink Micro, and Centec Communications have risen and fallen relative to the issue price18%、-8.21%、-12.14%。
Although the performance and stock price performance are not optimistic for the time being, many institutions**, the prospects for domestic chips in 2024 are still good. Debang** said that from the perspective of domestic mapping, on the one hand, the global AI wave is unabated, and the demand for training is still strong. With the optimization and iteration of cluster computing power, the comparative advantage of domestic chips over chips such as NVIDIA will be further expanded.
According to the latest report of the QYCondin research team, "Global Optical Communication Chip Market Report 2023-2029", the global optical communication chip market is expected to reach 70 in 2029$6.2 billion, with a CAGR of 128%。(Produced by Thinking Finance).