Refinancing Deregulation Of A Shares To Meet "Big Carnival" Hundreds Of GEM Companies Are Expected To Benefit

After 3 months of soliciting comments, the new regulation of refinancing was officially launched on Friday.

In February 17th, under the refinancing policy, the Shanghai and Shenzhen two cities continued to shake up. The Shanghai Composite Index and Shenzhen stock index rose by 2.28% and 2.98% respectively. The growth rate of the gem was the strongest and its closing rate rose to 3.72%.

The new rules for refinancing, moderately relax the scale of financing of non-public offering stocks, support the introduction of strategic investors by listed companies, and relax the conditions of pricing and locking mechanism, issuing objects, and approving the validity period of non-public offering stocks, and further delimit the new and old ones. The whole issue is "completion time".

The capital market has been greatly encouraged, with less than two days after the new rules have been settled, and many listed companies are actively responding to the new rules. On the evening of February 16th, many listed companies such as Longsheng technology, Yuan Li shares, Kai Laiying and other listed companies revised the refinancing scheme according to the new regulation, and Kai Laiying became the first publicly listed company to announce the introduction of strategic investors after the new rules were settled.

In February 17th, Wu Shijun, an eye secretaries, also made a public statement. The company's previously announced restructuring plan has nothing to do with the new rules of refinancing, and some new financing rules are applied to raise matching funds.

According to Wu Shijun, "the company intends to raise the matching funds to no more than 35 specific investors by issuing shares. The total amount is expected to be no more than 711 million yuan (including the cash consideration of 217 million yuan). This part applies the new regulation of refinancing, and adopts the way of inquiry, and the issuing price is no less than 80% of the average stock price of the 20 trading days before the price fixing benchmark. The lock up period is 6 months, and it is not applicable to reduce the relevant restrictions of the new regulation. "

Listed companies respond positively

In twenty-first Century, an economic report reporter learned that the refinancing deregulation was welcomed by a large number of institutional investors and listed companies. The advantages that bear the brunt are reflected in the way of issuance, which gives more space for listed companies and investors to make refinancing more market-oriented.

"The new regulation of refinancing has restored the lock price discount issue, reduced the selling period, and has not been restricted by the new rules. It can make full or partial recharge, providing better liquidity and security cushion for the investors involved. This year's economic challenge is great. If real estate is not released, it is expected that funds will enter the refinancing one and a half of the market on a large scale, which is a rare opportunity and time window for listed companies. Cao Jian, a senior executive of a listed company in Shenzhen, pointed out.

In February 14th, the CSRC announced that the refinancing rules were settled. In February 16th, Kai Lai Ying withdrew the 2019 year plan for non public development stocks (Revised Version) which had been prepared for six months, and announced a new fixed increase plan.

In the original revised version, the number of non-public offering of the company is no less than 10% of the total share capital issued before the company, that is, no more than 23 million 141 thousand shares (including the total number), and the total amount of raised funds does not exceed 2 billion 300 million yuan. The investment and investment projects include the research and development of bio macromolecule innovative drugs and preparations, and the construction of CDMO production base for innovative drugs, among which, 650 million yuan is added to supplement the working capital.

However, in the new refinancing plan issued in the evening of February 16th, the total amount of funds raised by the company did not change significantly, but the upper limit of the number of shares issued was significantly reduced.

The number of non public offerings issued by Kai Lai Ying will be reduced to no more than 18 million 700 thousand shares (including 18 million 700 thousand shares), and the price of non-public offering shares will be 123.56 yuan / share (the issue price is no less than 80% of the average stock price of the company's stock transaction on the twenty trading day before the benchmark price), and the total amount of the total raised is not expected to exceed 2 billion 311 million yuan.

By the end of February 17, 2020, the latest stock price of Kai Lai Ying was 176.77 yuan / share, and the issue price was 123.56 yuan / share, which is equivalent to 30 percent off of the current stock price of Kai Lai Ying.

In addition, Kai Lai Ying became the first company to announce the introduction of strategic investors. The company's shares will be fully subscribed by high allocating capital, and all the proceeds will be invested in the liquidity of the supplementary company.

"(new scheme) to catch up with the new regulation of refinancing, and the pricing mechanism has also been adjusted, which is based on the overall consideration. Gao Ling is a very good PE institution in the investment field. We feel that cooperation with high allocations, including strategic development, will be better. Considering these factors, we have decided on this plan. " In February 17th, the people of Gloria securities responded.

In February 17th, the price of Kai Lai Ying was closed.

And whether the proposed fundraising project in the refinancing scheme will continue in 2019, the person said: "these projects will still be implemented according to a certain plan. The original plan of item company has already started with its own funds, and then some matching funds will be allocated. The new scheme is fully subscribed by high allocations. The fund-raising is to facilitate the unified deployment of the company. The purpose is to supplement the flow. The company will also consider the project at a comprehensive level and make an overall plan for the project or elsewhere.

Worry about the risk of "changing"

In addition to the way of issuance, the new regulation of refinancing has lifted the unnecessary restrictions on refinancing of listed companies, and significantly expanded the group that meets the requirements of refinancing.

According to the information released by the SFC, as of February 13, 2020, 112 listed companies were in the queue of refinancing, of which 25 were in the stage of acceptance, 58 were in the stage of feedback, 26 had passed the trial conference, and 3 had suspended the review. Those companies that are still in line will benefit fully from the new regulation of refinancing.

In addition, with the most obvious gem, for example, according to the statistics of Tianfeng securities, for the public offering, the old rules require the two year profit and asset liability ratio requirements. After the new regulation abolished the asset liability ratio requirement, 432 eligible gem targets were added. For non-public offering, the new regulation was not related to the change of the asset liability ratio requirement. In recent two years, the profit requirement has increased 199 eligible gem targets.

In addition, compared with the draft, the new and old delimited nodes will be adjusted from the approved approval to the completion of the issue, which means that more cases will be applied to the new regulations. The specific beneficiaries were approval received in the past 6 months, but no case has yet been released. In terms of non-public offering, according to Tianfeng securities, this change will affect 62 private placement cases.

It is worth mentioning that with the adjustment of the refinancing policy and the significant expansion of the listed companies to meet the issuing conditions, there is also the sound of concern. The first thing to bear is the bloodletting effect on the A shares or the impact on the market. This will set a higher demand for the discerning ability of the investors.

"The new regulation of refinancing has lifted the unnecessary restrictions on the refinancing of listed companies, and is conducive to making the listed companies bigger and stronger by making use of the capital market. A lot of listed companies are expected to launch a refinancing plan, but the market funds are limited. They can be sent out without the introduction of a preplan. The competition of the issuing side will be fierce. Investors should choose companies so as to divide the company under market pressure. Wang Jiyue, a senior investment bank watchdog, said.

Wang Jiyue further pointed out that for investment banks, it would be a big cake, but the pressure of marketization of the issuance link appeared, and the brokers with weak issuance ability were not likely to be able to eat much. For ordinary investors, we should pay more attention to identify investment risks and avoid the companies that are not developing money.

On the other hand, some market participants also worry that policies can not be consistently adopted.

"After the hot market in 2015, new regulations came out. A lot of investors who have been involved in the fixed increase will have to abide by the rules of reducing the new rules after the sale period. In fact, the lock up period has been lengthening in disguised form, which has affected the liquidity of the market. If the institution or product is involved, the investors will be in trouble if the time limit expires, and it can only be postponed without delay. Cao Jian pointed out.

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