Gem 10Th Anniversary: Next Station Registration System

In another week, the gem will usher in 10th anniversary. In ten years, the number of GEM companies increased from 28 to 773, with a total market capitalization of 5 trillion and 680 billion yuan, and gathered a number of influential and competitive new industry companies. They played an increasingly important role in supporting the creation of dual enterprise groups, optimizing the entrepreneurial innovation ecosystem, leading the industrial upgrading and transformation, and accelerating the transformation of new and old dynamic energy.

Ten years from now, where will the next station of gem take its course?

Recently, Li Chao, vice chairman of the securities and Futures Commission, made clear for the first time the direction of the reform of the gem, which is to promote the reform of the gem and pilot registration system, and improve the basic system such as issuing, listing, mergers and acquisitions, refinancing and so on, and further enhance the inclusiveness of the system of innovation and entrepreneurship.

This means that, compared with Ke Chuang Chuang, the reform of the gem will be divided into two levels, first of all, the improvement of the existing system of gem, that is, stock reform. On the other hand, based on the experience of the registration system of the Chuang Chuang plate, the registration system reform will be extended to the gem.

The improvement of the existing system of GEM has begun. Last Friday, the SFC issued the revised "major asset reorganization management measures", allowing GEM companies to borrow their shell, and is considered to be the outpost of the gem registration system reform.

Nowadays, with the gradual reform of the reform route and the continuous action of the gem, the fourth quarter registration system reform is expected to become more intense.

Improve stock policy

The reform of the gem is the outpost of the gem registration system reform.

"Releasing the backdoor of the gem is an important part of the gem reform. This policy adjustment takes into account the policy flaws in the gem design, which is the optimization of existing policies. Ze Hao investment partner Cao Gang said.

For example, in 2018, GEM companies did not allow the backdoor to restrict the self rescue of some companies. In 2018, under the "tight credit" environment, some enterprises' capital chains were exposed to problems. The controlling shareholders' debts were very high. They basically could not help themselves through the efforts of the company and the actual controllers. However, under the restriction of no backdoor, some of the listed companies of the gem could not resolve the risks through mergers and acquisitions.

On the other hand, it is not allowed that backdoor also restricts the support of capital market to start-ups. At present, there are still a large number of high technology and high quality assets that satisfy the conditions of gem.

"The relaxation of the index of future reorganization and listing entry, and the release of the restrictions on the reorganization of listing will not be another important path for the company to enter the capital market." A senior Beijing Bao Dai pointed out.

Wang Jiyue, a senior investment banker, also said: "when the industry of listed companies is no longer booming, most listed companies can transform their main businesses through backdoor transactions so as to enable shareholders to increase their wealth. However, the GEM companies prohibit the backdoor transaction, even if the company's texture has slipped, and can only find their own way out, so some companies choose cross-border reorganization transactions, but because of the different industry rules do not understand and get into greater trouble, through restructuring to enhance the quality of listed companies' aspirations often fail.

In addition to mergers and acquisitions, refinancing restrictions also make many GEM companies complain, so refinancing policy adjustment is also the key direction of stock policy.

"Many GEM companies have managed to get listed successfully, but they find a more embarrassing thing: refinancing difficulties. In addition to the same refinancing policy as other sectors, the GEM listed companies need more than 45% asset liability ratio to publicly issue securities, many GEM companies belong to light asset companies, bank financing lacks collateral, enterprise development mainly uses self owned funds, and 45% of the line is the biggest obstacle for many GEM companies to make public financing. Wang Jiyue pointed out.

Collision between stock and increment

The reform of the gem stock policy is important, but the core of gem reform is the promotion of registration system in the growth enterprise market.

The implementation of the registration system of the science and technology innovation board is not only an experimental field for incremental reform, but also a breakthrough for promoting the incremental reform to the stock reform. At present, the registration system implemented in Shanghai Stock Exchange has basically been formed from circulation, transaction, information disclosure to supervision and other processes, systems and laws and regulations. At present, the science and technology innovation board is running relatively stable and has the basis of replication and popularization. There will be no obvious obstacle to the promotion of registration system on the gem, at least at the technical and institutional level, and the future registration system may continue to be promoted on the Shanghai and Shenzhen motherboards. Li Zhan, chief economist of Zhongshan securities, said.

But unlike the science and technology board, the gem will experience a collision between stock and incremental policies when it promotes the registration system.

"Specifically, the question of how registration system coexists with stock policy. The registration system brings about changes in various aspects, including mergers and acquisitions, refinancing and other issues. This is also the core issue of whether the future registration system can be further extended to other sectors." The senior Beijing Bao Dai said.

The collision between stock and increment is not only the problem of integration, but also the key to breaking new and old. For example, how to deal with the IPO listed GEM companies may also happen in mergers and acquisitions. The policy of the Shenzhen stock exchange is going to push more projects than that of the board. At present, it is difficult for the gem to completely create a new rule system, so it is very important for the original system to keep, update, optimize and adapt to the registration system. The head of investment banking of a medium-sized brokerage firm in Beijing pointed out.