In August, CICC Quickly "Returned To A" And Raised More Than 10 Billion Yuan To Build An Aircraft Carrier Level Securities Firm?

If there is no accident, China International Finance Co., Ltd. (hereinafter referred to as CICC) is expected to realize "return to a" by the end of October, becoming the 14th a + H listed securities company of a shares. This is only eight months since its "official announcement" on February 28.

This year is the "big year" for securities companies to be listed. During the year, BOC securities, Zhongtai securities and Guolian securities have all been listed on the main board of Shanghai Stock Exchange. Xiangcai securities has completed the curve listing through Harbin Gaoke and Yingda securities, and has completed the curve listing through confidence electric. In addition, with CICC, which has successfully returned to a, six securities companies have been listed this year. In contrast, in 2019, only Hualin securities and Hongta securities are listed in A-share market.

Looking back on the process of CICC's return to a, it is not too much to describe it as "plain sailing".

In August, "Huia" raised more than 10 billion yuan

According to the IPO process announced by CICC, it will launch an online roadshow on October 19. Investors will apply online and offline on October 20. There is no need to pay subscription funds when applying. CICC will announce the winning bid on 21 and 22 days after that.

Some securities practitioners pointed out that after the completion of the new share subscription, it is generally 8 to 14 days after listing, and the fastest time to be listed is 6 days after winning the lottery (two days after the Subscription Date). Even if there is a delay in listing, it generally does not exceed 14 days, depending on the arrangement of the exchange. In other words, CICC is expected to officially go public by the end of October if it goes well.

(the listing schedule shown in the prospectus is from wind)

As the only one of the top brokers to "Miss" the A-share market, CICC's journey back to a has made rapid progress nearly five years after it was listed in Hong Kong.

On February 28, CICC announced for the first time that it intends to apply for A-share issuance and be listed on the Shanghai Stock Exchange

On May 15, China Securities Regulatory Commission (CSRC) released A-share prospectus in advance on its website;

On August 28, the China Securities Regulatory Commission (CSRC) released the feedback on CICC's A-share IPO application documents, involving 37 issues in four major parts

On September 17, CICC's A-share IPO was held.

According to the latest prospectus released by the CSRC on October 12, according to the resolution of the general meeting of shareholders, after deducting the issuance expenses, the raised funds of this issuance will be used to increase the company's capital, supplement the company's working capital, and support the company's domestic and foreign business development.

According to the prospectus, CICC issued no more than 459 million shares. According to CICC's earnings per share in 2019 is 0.99 yuan / share, and according to the average price earnings ratio of 38.85 times of A-share securities dealers on October 16 shown by wind data, its issuance price can reach 38.46 yuan / share. Based on this calculation, its initial fund-raising scale may reach 17.654 billion yuan.

At the end of March this year, Huang Zhaohui, the new CEO of CICC, pointed out that in recent years, the reform and opening up of China's financial system has accelerated significantly, and important policies for the development of the capital market have been speeded up. The launch of the science and technology innovation board, the implementation of the new securities law, the full implementation of the registration system, and the optimization of the refinancing system have all released positive signals.

Based on this, Huang Zhaohui said that CICC must firmly grasp the strategic opportunity period in the next two or three years, increase investment, speed up the layout and realize leapfrog development. Finally, in the next few years, it will become the industry's leading position, build China's world-class investment bank, and really play a key role in the international financial market, and become the core participant of the future financial system. ?

Specifically, after the A-share listing, CICC will expand its share driven growth, speed up the replenishment of key resources, increase investment in personnel capital and it construction, and promote large-scale development.

AAA class Securities Dealers' seats have been suspended for seven years

With CICC's smooth return to a, it once again triggered speculation about "aircraft carrier class" Securities Companies in the industry. During the year, there have been rumors about the merger of CITIC Securities and CITIC construction investment, while the recent merger of Guolian securities and Guojin securities failed.

The other side of the urgent need for securities companies to become bigger and stronger is the steady progress of the two-way opening up of China's financial market. The first-class foreign securities companies are speeding up their competition for the domestic market, becoming the "catfish" that stirs up the domestic securities industry.

On October 10, according to the information on the website of the SFC, Standard Chartered Bank (Hong Kong) submitted the application materials for approval of the establishment of a securities company, which was received by the SFC on the same day.

According to incomplete statistics by reporters, in recent years, there have been as many as eight foreign-funded holding securities companies in China, including JPMorgan securities (China) Co., Ltd. and Nomura Orient International Securities Co., Ltd. both of which have successfully opened business.

In November last year, the CSRC said that the next step would continue to encourage and guide securities companies to enrich capital, enrich service functions, optimize incentive and restraint mechanisms, increase investment in technology and innovation, improve international layout, strengthen compliance risk control, actively promote the establishment of aircraft carrier level head securities companies and promote the sustainable and healthy development of the securities industry.

How to define aircraft carrier level securities companies? In terms of the scale of equity underwriting business, the top three China and one China listed in the industry, namely CITIC Securities, China CITIC construction investment, Huatai United Securities and CICC, ranked among the top four with 124.729 billion yuan, 119.155 billion yuan, 60.147 billion yuan and 46.167 billion yuan respectively in the first half of this year, accounting for 53.18% of the total industry share, and the market share further increased compared with 47.15% in the same period last year There is still a certain distance between aircraft carriers.

A securities investment bank personage pointed out to reporters, "CICC has always been famous for its investment banking business in the industry. In the past few years, it has missed a good opportunity for rapid development because it has not listed in A-shares. However, the merger of CIC securities in the past two years and the introduction of Tencent and Alibaba war capital show that the transformation is accelerating. CICC's international level is leading in the industry, and it is also worth looking forward to in financial technology. " ?

In May this year, the China Securities Regulatory Commission (CSRC) revised the regulations on Classified Supervision of securities companies issued in 2009 for the third time. According to the regulations, securities companies are divided into five categories (a, B, C, D, e) and 11 levels. ?

According to the classification results of securities companies released by China Securities Regulatory Commission on August 26, 15 securities companies were rated AA this year, of which 5 were newly upgraded to AA this year, but none of them was rated as the highest level AAA. ?

It is worth noting that, after reading the rating data of previous years, the reporter found that AAA class securities dealers had been vacant for seven years. At present, the market also needs top securities companies to sit down to fight against foreign securities companies that are rubbing their hands.

"With the relaxation of regulation on foreign investment, some excellent local head brokers may grow into international securities companies," Yang Delong, chief economist of Qianhai open source fund, told reporters. Securities companies that lose competitiveness or fail in transformation may be eliminated, and the survival of the fittest may bring better opportunities for head brokers. ?

The aftereffect of Ruixing event is not over

Although CICC's return to a was very smooth, it was not without worries. In April this year, after being short in muddy waters, lucky coffee disclosed that it had made financial fraud of 2.2 billion yuan, and CICC, as a joint lead underwriter, was also "dragged into the water".

In the latest prospectus disclosed on October 12, CICC made a further explanation on the Ruixing incident according to the requirements of the CSRC.

In the initial offering of the prospectus, CICC only made a passing remark on the lucky incident, saying only that "the group will pay close attention to the progress of the event, evaluate and actively respond to the possible impact of the event on the group." ?

Subsequently, in the feedback opinion given by the CSRC on August 28, CICC was required to add, "the main work and responsibilities of the company in Ruixing coffee's overseas listing business, whether there are major defects in the relevant internal control, whether there is a claim risk, if so, the countermeasures taken and the impact on the company's operation and this IPO." ?

According to the relevant provisions of the securities law, securities service institutions should be diligent and responsible for making and issuing financial advisory reports and other documents for securities issuance, listing, trading and other securities business activities, and check and verify the authenticity, accuracy and integrity of the documents and materials based on. ?

CICC pointed out in the updated prospectus that "CICC Hong Kong Securities, an overseas subsidiary of the company, is listed as the co defendant of the class action because of the underwriting service provided by lucky coffee. The company may be liable for compensation in the relevant class action, but the actual risk of compensation is small." ?

In addition, another subsidiary of CICC also participated in the syndicated loan to Haode investment Inc. (hereinafter referred to as "Haode") of lucky coffee. Haode is a family trust fund owned by Lu Zhengyao, chairman of lucky coffee. According to the data, Haode holds about 297 million shares of Ruixing coffee. As Ruixing has been delisted, Haode will be applied for liquidation.

According to the disclosure of CICC, as of the end of the reporting period, the balance of the syndicated loan was 169 million yuan. Due to the financial fraud of Ruixing coffee, the stock price had dropped sharply and the market was delisted from the NASDAQ Exchange. As a result, the value of the Pledged Shares of the syndicated loan was greatly impaired, and there was significant uncertainty in the repayment ability of the lender. Therefore, CICC made full provision for impairment of the above loans 。

On October 12, the General Administration of Market Supervision announced that it had made administrative punishment decisions on the illegal acts of unfair competition of Ruixing coffee (China) Co., Ltd. and Ruixing coffee (Beijing) Co., Ltd., and fined 2 million yuan each. When investigating the financial fraud case of lucky coffee, the General Administration of market supervision found that more than 40 companies conspired with Ruixing coffee. ?

At present, the adverse impact of Ruixing incident on CICC has not completely disappeared.