20 IPO Companies Press "Stop Key" In The New Year

At the beginning of 2021, the supervision of IPO audit will be tightened.

According to wind data, in the month from the beginning of 2021 to the present, there have been 20 cases of "termination of examination" or "termination of registration" in the A-share IPO market. In contrast, in the fourth quarter of 2020, the number of similar entrepreneurs was 47, while in the first three quarters of 2020, only 30 enterprises' IPO progress was terminated.

From the reason of termination, most of the issuers take the initiative to cancel the listing declaration materials, which also makes the market "smell" the increasingly strict atmosphere of IPO audit. "Feel the pressure of audit, enterprises will take the initiative to withdraw materials." Beijing area small and medium-sized securities investment bank personnel said.

This is not the only way for IPO tightening.

On January 29, China Securities Regulatory Commission (CSRC) officially issued the "Regulations on on on-site inspection of first-time enterprises", which originally stayed in the window guidance on paper. In addition, the 21st century economic reporter has learned that the regulatory authorities tend to be more strict in identifying the nature of scientific and technological innovation.

In 2021, there may still be some variables in the A-share IPO market under the gradual implementation of the full registration system.

At the beginning of 2021, the supervision of IPO audit will be tightened. -Photo by Gan Jun

On site inspection of "weapons" in place

"The recent IPO termination review is more common, and from the data point of view, it is more frequent than at the end of last year." There are senior investment banks in Beijing said.

According to wind data, since the beginning of 2021, a total of 62 enterprises have been on the meeting for the first time, of which 55 have been approved. Another two enterprises have postponed their voting, two have not passed and one has cancelled the audit. The overall passing rate is close to 89%. In the fourth quarter of 2020, 235 enterprises will be on the meeting for the first time, with the attendance rate of 95%. In 2020, the overall IPO market meeting rate will be about 95%.

However, as for the reduction of the passing rate, the above-mentioned senior investment banks said that it was still within the range of fluctuation. "The market has not seen the situation of" six over one "and" five over one "when the IPO audit became more stringent, only that some enterprises with problems in the short term were denied. From this point of view, the IPO audit standards have not changed substantially.

In terms of the supervision's attitude towards IPO companies, industry insiders have given more feedback on the tightening of regulatory attitude since October last year.

"Although the standards have not changed, the standards have been strictly enforced." The above small and medium-sized securities investment bank personnel believe that IPO on-site inspection has become the main means of tightening the audit scale.

Before that, some investment banks close to the regulatory level told the 21st century economic report that the exchange often adopted on-site inspection to alleviate the problem of excessive concentration or excessive number of queuing enterprises, because the time for on-site inspection is not included in the six-month audit period. It will mainly carry out on-site inspection for the listed enterprises with declaration conditions and those enterprises that the exchange thinks have potential problems.

"Since October last year, perhaps in order to control the IPO rhythm, the exchange level has increased the frequency and intensity of on-site inspection. As a result, the enterprises with problems are forced to cancel the declaration materials voluntarily after receiving the inspection, while some enterprises withdraw the materials just after receiving the on-site inspection notice. " The above small and medium-sized securities investment bank personnel said.

The "sharp weapon" of on-site inspection was upgraded at the beginning of this year. On January 29, the China Securities Regulatory Commission (CSRC) issued the regulations on on on-site inspection of first-time enterprises, which originally stayed in the window guidance on paper.

As a matter of fact, at the end of October 2020, the time point when the CSRC solicited opinions from the public on the "Regulations on on on-site inspection of first-episode enterprises" is taking place after the regulatory authorities have strengthened the on-site inspection.

"Comparing the draft for comments and the official documents, we can find that the means of on-site inspection are more abundant in the official documents. The flow regulation and inspection of production and operation sites mentioned in the previous draft are routine items for on-site inspection under the guidance of the previous window. " The sponsor of another medium-sized securities firm investment bank pointed out that the on-site inspection system after the promulgation of the new rules also includes the inspection of the issuer's industrial and commercial information, accounting books and financial statements, and on-site evidence collection of working papers of intermediary agencies. "After the frequency of on-site inspection increased last year, the intensity of inspection also increased with the implementation of rules."

What's more, the "Regulations on on on-site inspection of IPO enterprises" no longer carries out the inspection for enterprises that withdraw their IPO applications within 10 working days after receiving the on-site inspection. However, when the Company re applies for IPO within 12 months after withdrawing its application, it will be directly listed as the object of examination.

"We are now required to take the initiative to withdraw materials when we find problems in the enterprise, and try not to touch the" mould "of on-site inspection. Although it is OK to withdraw materials after on-the-spot inspection, it means that the IPO will be watched by the regulatory authorities in the future. " According to the above-mentioned personnel from the investment banks of small and medium-sized securities companies in Beijing, the new regulation may also lead to more common situations in which the IPO companies voluntarily withdraw their application materials and terminate the examination.

The hidden threshold of scientific and technological innovation may be tightened

In addition to the "sharp sword" of on-site inspection, the threshold of the scientific and technological innovation board may also be tightened.

"The CSRC is also dissatisfied with the quality of enterprises on the science and technology innovation board. Judging from the recent statements made by the regulatory authorities, the criteria for identifying the nature of scientific and technological innovation will be further strengthened in the future. " The senior investment bank said.

He Nanye, an investment banker, said that since the implementation of the registration system of the science and technology innovation board, the qualification of enterprises has indeed declined. More and more enterprises have been withdrawn or voluntarily withdrawn under the guidance of the window, and the number of enterprises that have terminated the audit has become a normal phenomenon. "Now big ticket companies choose projects, because the quality of projects is more and more uneven."

Wind data shows that of the 20 enterprises that have terminated the audit or registration since 2021, 10 are from the science and technology innovation board, the remaining six are from the gem, two are from the main board, and one is from the small and medium-sized board.

In March 2020, the China Securities Regulatory Commission (CSRC) issued the guidelines on the evaluation of scientific and technological innovation attributes (for Trial Implementation), which identified the scientific and technological innovation attributes of enterprises applying for IPO through three conventional indicators of "R & D investment amount or proportion of R & D investment in business income", "invention patent", "compound growth rate of business income or business income" and other 5 exceptional clauses.

But recently, the CSRC said at the 2021 system work meeting that it would "improve the evaluation criteria for the attribute of scientific and technological innovation". The "action plan for building a high standard market system" issued by the general office of the CPC Central Committee and the general office of the State Council also requires "adhering to the positioning of the science and technology innovation board and highlighting the characteristics of hard science and technology".

"At present, there is no change in the audit of the science and technology innovation board, but in the future, we should highlight the hard technology. It is expected that in 2021, the board will start to appear a hidden threshold on the recognition of the scientific and technological innovation attribute, which will lead to a lower pass rate of the board and an increase in enterprises taking the initiative to withdraw materials." The above senior investment bank personage pointed out that at present, there are still a few enterprises that can really take up the concept of "hard technology". After the science and technology innovation board has absorbed some high-quality companies in the early stage, and the subsequent identification of scientific and technological innovation attributes is more strict, whether the incremental enterprises can keep up with it is also a serious problem.

According to wind data, a total of 396 enterprises in the A-share market will realize IPO in 2020, among which 145 enterprises, accounting for nearly 37%, are supported by the science and technology innovation board. From the perspective of financing scale, the financing amount of the IPO project of the science and Technology Innovation Board reached 13 billion yuan, accounting for 49.42% of the total financing scale of the A-share market.

"From the current situation to guess, the science and technology innovation board in 2021 should not have such a good IPO performance." The senior investment bank said.

However, Wang Jiyue, a senior investment banker, believes that it should be left to the market to judge.

He pointed out that some companies listed on the science and Technology Innovation Board recently can not be regarded as hard technology strictly speaking, but the market is very satisfied. "In fact, Ali, Tencent, meituan, pinduoduo, which is hard technology?" Wang Jiyue believes that enterprises should be allowed to package the attributes of scientific and technological innovation, and then the packaging should be opened by a perfect letter. Everything is exposed to the sun, and the value of enterprises is determined by the market.

?