The Way Out For Gem In 2011: The Four Sword Refers To The Issue Of High Price Earnings Ratio.

If the stock market in 2010 has the largest number of topics and the most controversial issue, it is believed that the gem is the most important one.

Today, CCTV's "finance and economics sword" special program will broadcast the "GEM board", Renmin University of China assistant president Wu Xiaoqiu, China University of Political Science and Law Capital Research Center Director Liu Jipeng, Yanjing Huaqiao University President Wahson, Tx Investment Consulting Co chairman and general manager, Lin Yi Xiang and "Securities Daily" executive deputy editor Dong Shaopeng and other experts will discuss the issue of high price earnings ratio and system improvement of gem.

Gem

How high is the P / E ratio?

The issue of high price, capital raising, and wealth creation by executives are almost all related to the high issue price earnings ratio of gem.

Since October 30, 2009, the first 28 companies have entered the Shenzhen Stock Exchange's growth enterprise market. Although the price earnings ratio of GEM has gone through fluctuations, the overall situation is still rising steadily.

Especially in December 2010, the average price earnings per share of the 12 GEM stocks reached a record of 92.06 times.

After entering 2011, the average price earnings ratio of the 5 new shares listed in January 7th was 93.07 times higher.

Compared with the issue of price earnings ratio rising steadily, the recent gem IPO is frequently encountered in the two tier market.

Gem's price earnings ratio has risen steadily, and the risk of fire has risen to the extreme.

To answer this question, we first need to start with the issue of price earnings ratio of the growth enterprise market.

So how many times is the issue price earnings ratio reasonable in the eyes of different experts?

Wu Xiaoqiu, assistant director of Renmin University of China and director of the Institute of Finance and securities, said, "no one has a reasonable price earnings ratio" because the industry is different.

In this regard, he further explained: stock pricing is related to many factors, first of all is related to the growth of its industry; secondly, it is related to the management level of the company itself and its strategic direction; third, it is related to the stock market situation at that time.

"Based on these three views, I think there is no artificial standard, for example, 20 times must be a reasonable price earnings ratio."

Wu Xiaoqiu said.

Liu Jipeng, director of the capital research center of China University of Political Science and Law, has clearly expressed the view that "the price earnings ratio below 30 times is reasonable".

The question of "how many times the price earnings ratio is appropriate" is based on the price earnings ratio of Hongkong and the US NASDAQ: the average price earnings ratio of NASDAQ in the past 14 years is about 16 times, the interval is between 12 and 20 times, and the average price earnings ratio of Hongkong is about 12 times.

China's gem is different from them, because we have the threshold of the gem.

Wahson, President of Yanjing Huaqiao University, said, "according to the actual situation in China, 40 times to 60 times is relatively reasonable."

At the same time, Wahson agreed that "there is no fixed standard for individual companies, because industries and businesses are different".

However, he also pointed out that, as a gem, considering the reality of our country, in the current market environment, 40 to 60 times price earnings ratio is relatively healthy.

Lin Yixiang, chairman and general manager of Tx Investment Consulting Co and vice president of China Securities Association, think that "10 to 50 times the company and market situation" should be considered, because GEM companies should be very different.

For the "big difference", Lin Yixiang deliberately explained that the companies on GEM are relatively small, some of them may go bankrupt and fail in the end, and others may do a lot.

This will lead to a very large gap in the enterprises listed on the gem, so it can not give a standard price earnings ratio.

The poll results of the audience showed that 20.6% of the audience under 20 times accounted for 20.6%, accounting for 37.4% to 20 times to 40 times, 24.3% to 40 times to 60 times.

What are the shortcomings of the distribution system?

After their respective views, several experts launched a heated debate.

Liu Jipeng said, "we need to stab Wahson and Wu Xiaoqiu."

He said that there are two kinds of ideas that need to be clarified in theory. One is that the high price earnings ratio can leave the money raised to the listed companies. If it is issued at low price earnings ratio, the investors who leave the money to the two tier market are left to speculators.

I do not support this idea.

The other is that we must strictly examine and approve, strictly control the listing, and make high-quality products.

Therefore, it is impossible to compare large-scale issuance, and can not realize the marketization of the scale of issuance. Only by implementing the inquiry system of stock and realizing the marketization of the issuing scale, it is a misunderstanding of the issue price of the market.

As for what Liu Jipeng said, "I argued with Wahson in January last year, I criticized some of the phenomena released in the first 3 months. Wahson thought that the issuing system was very good at that time, and today there are such a gap between the two people". Wahson quickly clarified that "Liu Jipeng's current distribution system is very good" is not my own view.

He explained at the same time: the direction of market-oriented reform of IPO is correct.

Not to say that the issue price is low will be good for investors in the two tier market.

In fact, it is even worse for them - the issue price is low, for example, 20 times the price earnings ratio, the first day of listing is basically tripled, the gem stock market is five or six times normal, the money is in the hands of the successful bidder, the two tier market is still high priced.

In this market structure, the market gives such a high valuation.

Now the money raised is good for entering a listed company. The stock you buy is very real. If most of the money is taken away by the winner, the listed company also has no money. The two tier market investors pay higher price and greater risk.

The hidden rules behind the "three high" phenomenon

After stabbing Wahson, Liu Jipeng stabbed Wu Xiaoqiu with his sword.

He asked Wu Xiaoqiu: if 163 consecutive enterprises are issued at an average price earnings ratio of more than 70 times, do you feel normal?

In response, Wu Xiaoqiu said that China's "three high" phenomenon is related to the system. The system is mainly based on three levels. First, we have not established an effective and efficient delisting mechanism.

If we have a very clear and efficient delisting mechanism, the "three high" phenomenon will gradually come down.

Second, it has something to do with inquiries shareholders.

These shareholders are very powerful in mobilizing resources. They raise prices through a wide range of resources. Third, they are related to the supply system.

The supply of the growth enterprise market is very small. Under such conditions, it is really the relationship between supply and demand that determines the price, so the price rises.

Lin Yixiang refutes Wahson's "consideration of the current institutional arrangement and the status of gem enterprises, giving the price earnings ratio higher, 40 times to 60 times normal" view, and believes that "there is a contradiction in logic".

In response, Wahson said, "now 90 times, 70 times more is really too high."

He said that China's current objective economic and market conditions, if it adopts its own proposed system, can be reduced to 40 times to 60 times, which means that investors on the gem must bear the reality that the share price has dropped by half.

"So I think, they say 30 times, 10 times, 20 times, means that after that kind of measures come out, the market will have more havoc, which is not in line with the current market reality."

Financial commentator Ye Tan said, "one thing must be separated", that is, the high price earnings ratio of individual enterprises is not the same as the high price earnings ratio and "three high" of the overall market. If the general high, there must be big problems.

Wei Baochuan, chief economic analyst of China Securities Daily, said, "I agree with Wu Xiaoqiu very much".

He said that the information feedback mechanism of current quotations and quotations has formed a chain of interests, and this interest chain has dominated a small thing to a large extent.

"Three high" solutions

Since the issue of high price earnings ratio is the main sticking point of the growth enterprise market, what measures should be taken and what system should be perfected to solve this problem?

There are two kinds of viewpoints in the industry: first, we should introduce the delisting system as soon as possible, so as to give warning to investors in the primary market, thereby inhibiting the irrationality of the new stock purchase process; two, we should relax the auditing standards for issuing and listing, and increase the number of GEM companies, that is, by increasing supply, we can guide the issue of price earnings ratio to fall back effectively.

At the same time, there are also suggestions that we should improve the refinancing mechanism as soon as possible, control the proportion of the funds raised in the IPO, raise the sponsors' responsibility for the performance of listed companies, and introduce the market maker system.

The first sword:

The delisting system emerges.

So, which of the most important suggestions? For this, the four experts on this "sword".

Liu Jipeng believed that the distribution system should be changed and the responsibility subject should be clearly defined. Wu Xiaoqiu put forward the idea of establishing an efficient and high-speed delisting system. Wahson's view is: first, prohibit the pfer of capital stock; second, prohibit the change of the main and reorganization of the shell selling delisting, and third, the introduction of a fast channel complaint; Lin Yi commensurate that "reform should be matched, not only pricing, but also a combination of the issuing system and the delisting system."

Liu Jipeng explained his strategy in detail.

He said that the gem "three high" over raised, the origin of the issue on the issue.

According to China's national conditions and the characteristics of the gem, learning from international experience, the gem should be pformed from the substantive approval system to the formal approval system, and the responsibility subjects should be clear about sponsors and securities dealers. If there is a problem, the qualification of market access will be stopped.

At the same time, he proposed that we must liberate the scale of issue.

He believes that too many enterprises in China are waiting to be listed, but on the contrary, the inquiry system with no market size is not a real market.

Generally speaking, the growth enterprise market is a high growth and high-risk market, but without an efficient and fast delisting mechanism, it will not be a high-risk market at first.

In this way, the gem will become a market without growth and completely deviate from the nature of the growth enterprise market, "Wu Xiaoqiu said.

In order to show that the market is a high growth and high-risk market, he believes that the establishment of an efficient delisting mechanism is the most important.

In this way, high growth enterprises can be chosen, and a real risk mechanism can also be established.

As to how to determine the delisting criteria, Wu Xiaoqiu said, the first problem we need to solve is "we don't want what kind of market the GEM market is like."

For example, we do not want the gem enterprise to be a fake enterprise, who will leave the market if it is fake. We do not want the gem enterprises to be a continuous loss of enterprises. Continuous losses are to be delisted. Enterprises that do not want the growth enterprise board are a Asset Management Co and investment management company. They take money instead of putting it in the main business, but invest in entrustment, and such enterprises should also be delisted.

"In short, it is to establish a delisting mechanism and standard which is totally different from the main board market."

Wu Xiaoqiu said.

Second Swords:

Lowering the threshold for listing

"From issuing to pricing, then to the two tier market, and then to the delisting, this is a whole process."

Lin Yixiang said that reform is a whole. To do one thing, we should consider matching and coherence. Just like a water pipe, from outside to outside, the bandage is very tight. It is difficult and difficult to get into.

At the same time, he questioned the logic of "raising the threshold and demanding" for fear of insolvency, bankruptcy and delisting in the capital market.

"This worry is not true," Lin Yixiang said. First, sooner or later, there will be enterprises going bankrupt and delisting. This responsibility is not a regulatory sector. It is a natural phenomenon. If we want to be clear about our understanding, we must lower the issuing threshold. "Actually, we can see that the real standard of gem enterprises is much higher than the statutory standards."

As for the saying that "GEM companies are serious in the capital market and release the scale of the issue is not enough market funds", Lin Yixiang expressed the need to dialectically see that if the market anticipates that enterprises that meet the regulatory requirements can be listed, then many enterprises will go on the market. Will there be investors willing to pay 90 times, or even higher price earnings ratios, to buy the shares they issue? No more.

Wu Xiaoqiu expressed "no approval" for this view.

"If we deal with the problem of gem, especially the so-called" three high ", I think the issuing system is absolutely not the most important. If the market does not have the mechanism of risk pressure, how to change the distribution system is useless. You can only change it to 20 times price earnings ratio, only after the listing price has doubled three times, there is no change.

Wu Xiaoqiu said.

He believes that there is not much room for the reform of the distribution system, and that the direction of marketization should be correct. There are flaws in it. The flaw lies in the structure of shareholders, and the issuing system itself is hard to say that there are flaws.

"Shareholder structure is out of order. Shareholders' structure operates the issue pricing. This is the core, and also plays a very important role in rent-seeking shareholders, and without effective and fast delisting mechanism, of course, this will happen."

Third Swords:

The company shall not pfer the capital stock within 5 years.

"I do not agree with the way to expand the supply," Wahson said. It can be imagined that if the listing standards are in line with the current listing standards, 10000 enterprises will be required to go public, and our capital market will only go to more than 1000 in 20 years. If we make thousands of enterprises on the gem immediately, the market will be in a mess. Nobody wants to see it.

"I think their approach is a bit like the old story we heard in the past, with two doors and a clip on the hunchback."

Wahson said.

Wahson said it could use expanded circulation, but the effect was limited.

The "three high" distribution is concentrated on micro businesses. The Agricultural Bank of China (601288 shares) has no "three high".

At present, it can be quickly introduced and is the key measure to solve the "three high" phenomenon of the growth enterprise market.

Wahson said.

In response, he put forward three proposals:

The first is to prohibit the "three high" enterprises to pfer capital stock in 5 years.

The reason why the gem is hyped is that they raise so much money that they can send 10 to 10. They can do it again and again.

If you take this one off, it will be a drastic solution.

The problem now is not only the question of enquiry, but also the valuation of the market is too high.

After it has been drastically elected, we feel that these enterprises will not be able to fry within 5 years, and the market price will be moved underground.

"I think this is very easy to do, and it is just now in the new year, and I will start sending shares immediately. If it comes out, I believe that the P / E ratio will be at least 20% to 30%."

Wahson said.

Second, it is announced that the GEM market is prohibited from changing the main business and prohibiting the reorganization of the shell.

He also agreed with Wu Xiaoqiu about delisting.

The third is for inquiry.

Because under the present circumstances, it is hard to say that the inquiry organization has increased the price.

Because the price of the two tier market is higher than that it inquired, the main responsibility of the inquiry organization is the authenticity, which is the authenticity of the information disclosed by the listed company, and can not be over packaged.

We now see that excessive packaging and beautification of listed companies are very common.

"Therefore, I think the third proposal is that the SFC should immediately introduce a fast appealing channel. Any false package will be over beautified. All investors will be able to appeal. After the appeal, the fast track will be awarded and the future losses will be borne by them."

"If there are three measures to reduce 40 times to 60 times, there will be a basis for others to study slowly."

Wahson said.

As for Wahson's opposition to "expanding supply", Liu Jipeng said that the number of small and medium-sized enterprises in China is very large, and that capital market is the main battleground for China's rise. This must be cultivated as soon as possible.

The focus now is on financing difficulties for small and medium-sized enterprises. In discussing the growth enterprise market, we should scale up the scale, which will not bring too much market pressure.

He also said that now the key approval system, this bottleneck relates to the core content of the reform of the distribution system.

Nowadays, "trial" and "prison" are unified, which is unreasonable in the system.

Lin Yi commensurate, in fact, we say that inhibiting the high price earnings ratio is not simply to suppress the high price earnings ratio, but to create a system and mechanism, so that the value of enterprises can return to a comparison.

At the same time, he said he did not agree with Wahson's several measures.

Whether to allow the pfer of capital stock does not substantially change the value of the company and the market's assessment of it is merely a pure.

Fourth Swords:

No change in main business disputes

As for the "Prohibition of changing the main camp", Lin Yi claims that he has come into contact with most of the owners of gem and small and medium-sized board enterprises. They have worked for more than ten years and 20 years. In this process, they have changed a lot of main businesses, but they may have found their main business in the past three or five years, and have survived and expanded.

"Gem enterprises will also change according to the situation, and can not break the road of changing their main business in order to survive and develop if necessary."

At the scene, Wahson further elaborated.

"The core issue now is whether we can allow the reduction of the threshold to allow enterprises to go public on a large scale, and this way to reduce the price of the gem is not feasible at all. This will lead to big problems."

Wahson said, on the one hand, the market is mixed up and everything is there. Investors will then ask how regulators supervise the market, and why there are thousands of GEM companies in a year or two. At that time, people were more indignant. "This seems reasonable, but in fact it is not feasible."

For Liu Jipeng's claim that "if every household raises two hundred million, it will not consume a lot of money in the market", Wahson calls it "just his imagination", because how much it is raised is determined by the market; and even though IPO did not raise enough funds at that time, the two market price was very high, so the market value of the reduction was still an amazing market value.

Ye Tan believes that if the responsibility of the intermediary is clear, if it is severe enough, it is afraid to do so.

Cui Shuwen, director of the Ministry of economic and social affairs, said that the management of the gem really needs supporting management. It is necessary to perfect the system from the issuing system and the delisting system.

He suggested that some things should be identified and handled in a timely manner. This is very important.

Dong Shaopeng, executive deputy editor in chief of the Securities Daily, said: "the total amount of funds raised to control the scale of issuance is not equal to the administrative control of pricing, but to maintain the fairness and fairness of the use of social capital.

"The direction of marketization can not be changed, and this is unwavering. But if we want to make a real market economy, we must allow the enterprises that have the conditions to have fair opportunities to go public. We must change the issue of trial issuance. We must not change this link, while we should put the main body of responsibility in the intermediaries and then to the exchanges."

Liu Jipeng said, now everyone is advocating delisting, who will be responsible for the problem of delisting? If we implement the sponsor's head, it will be prudent, but will be responsible to investors.

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