492 companies raised a total of 536.3 billion yuan

  The number and scale of A-share IPOs this year both hit a record high

  Our reporter Sun Jie

  492 companies went public for the first time, with a fundraising scale of RMB 536.3 billion, an increase of 25% and 14% respectively year-on-year. These two key data of A shares are expected to both hit record highs.

In 2021, which is about to bid farewell, the global IPO market remains active, and the performance of A-shares is still eye-catching.

Recently, Ernst & Young, KPMG and other institutions have issued reports to check the characteristics of IPOs, which all confirm this.

The in-depth advancement of the registration system and the emergence of the Beijing Stock Exchange are becoming new bright spots in the A-share IPO market.

  Top 10 IPOs in the world

  Chinese companies account for 6 seats

  2021 will be the most active year for global IPO activities in the past 20 years.

On December 15, Ernst & Young released the "Initial Public Offering (IPO) Market Research in Mainland China and Hong Kong" report, showing that a total of 2,388 companies have been listed globally, raising US$453.3 billion.

Compared with the same period last year, the number of IPOs and the amount of funds raised increased by 64% and 67%, respectively.

  A shares and Hong Kong stocks are still the most active markets for IPOs in the world. The number of IPOs and the amount of funds raised account for 25% and 28% of the world's total.

From the perspective of stock exchanges, following the Nasdaq Stock Exchange, the number of IPOs on the Shanghai Stock Exchange and the Shenzhen Stock Exchange will rank second and third in the world with 254 and 227, respectively.

  Among the world's top ten IPOs this year, there are as many as six mainland Chinese companies, namely China Telecom, Kuaishou Technology, Didi, JD Logistics, Three Gorges Energy and BeiGene.

One of the three major operators, China Telecom, landed on the main board of the Shanghai Stock Exchange in July this year. This "Big Mac" raised a total of 54.2 billion yuan, and only one accounted for one-tenth of the total A-share IPO fundraising. .

  Although many uncertain factors affect investor sentiment, the global IPO market still maintains a strong momentum.

KPMG China Capital Markets and Practicing Technology Lead Partner Liu Guoxian believes that the new crown epidemic has promoted the government and enterprises' attention to sustainable development plans, and has accelerated the number of listings of renewable energy, electric vehicles and other innovative companies focused on sustainable development. increase.

"Despite the continuing economic uncertainty, the capital market will continue to provide these fast-growing companies with the funds they need and promote fund-raising activities in the coming year." He said.

  Beijing Stock Exchange "Admission"

  Broaden SME IPO channels

  "The reform of the securities law in the Mainland and the subsequent introduction of the ChiNext registration system, the partial improvement of the science and technology innovation board system, the establishment of the Beijing Stock Exchange, the return of pilot red chips, and the transfer of selected layers of the New Third Board, mean that China's capital market is opening a new era. "He Zhaofeng, EY's Greater China Listing Services Lead Partner, said.

  Looking back at the A-share market, it is estimated that 492 companies will be listed for the first time throughout the year, raising RMB 536.3 billion. The number of IPOs and the amount of funds raised respectively increased by 25% and 14% year-on-year, both showing double-digit growth.

Compared with the same period last year, the proportion of small and medium-sized A-share IPOs has further increased. The number of IPOs of less than 1 billion yuan accounted for 77%, which was 4 percentage points higher than last year.

  In terms of industries, the A-share industry and technology, media, and telecommunications industries ranked first in terms of number and funding, and biotechnology and health IPOs and funding both entered the top five.

In terms of regions, Zhejiang, Guangdong, Jiangsu, Shanghai and Beijing ranked in the top five with 86, 85, 81, 47, and 36 IPOs, accounting for 68% of the total number of IPOs.

In terms of fundraising, the top five are Beijing, Guangdong, Zhejiang, Shanghai and Jiangsu, accounting for 72% of the total fundraising.

  The registration system has become the mainstream of IPOs.

According to the Ernst & Young report, in 2021, more than 70% of A-share IPOs will be issued under the registration system, and the number of IPOs and the amount of funds raised account for 75% and 66% respectively.

The number of IPOs on ChiNext ranks first, while the Science and Technology Innovation Board takes the first place in fundraising.

  The Beijing Stock Exchange, which was born in September this year, officially opened in November, ushering in the first batch of listed companies.

Up to now, a total of 11 new shares of Beijing Stock Exchange have been successfully listed.

The data shows that among A-share IPOs, the number of IPOs and the amount of funds raised by the Beijing Stock Exchange accounted for 2% and 0.4% of the total for the year, respectively.

  The Beijing Stock Exchange is a further pilot for the registration system, and its "entry" is also expanding the IPO channels for SMEs and accelerating the integration of capital and technology in the A-share market.

Liu Dachang, a partner of KPMG's China Capital Markets Consulting Group, said that the Beijing Stock Exchange and the Shanghai and Shenzhen Stock Exchanges complement each other and broaden financing channels for high-growth innovative companies in the Mainland. The Beijing Stock Exchange will cultivate small and medium-sized enterprises to grow into "little giants."

  China Concept Stocks Return to Unicorn Listing

  Strong support for Hong Kong stocks

  The return of Baidu, Station B, Ctrip, Xiaopeng Motors, and Ideal Auto, coupled with the listing of unicorns such as Kuaishou, JD Logistics, and Lianyirong, accounted for 90% of the top ten IPOs.

In 2021, Hong Kong stocks are expected to have a total of 94 IPOs with a total of HK$323.7 billion in funds raised. Compared with the same period last year, the number of IPOs and the amount of funds raised have decreased by 35% and 19%, respectively.

From an industry perspective, a total of 33 biotechnology and health companies went public this year in Hong Kong, ranking first in the number of IPOs.

  In terms of U.S. stocks, it is estimated that 39 Chinese companies will first go public this year, with a fund-raising amount of US$14.039 billion. The number of IPOs and the amount of funds raised have increased by 18% and 15% respectively over the same period last year.

In the second half of the year, Chinese mainland companies' listing activities in the United States fell into a trough, with only three listings in the United States.

  Regarding the IPO outlook in 2022, Ernst & Young said that although the uncertainty of the epidemic will still affect the profit growth of the stock market, many positive factors will affect IPO activities.

This includes that the mainland of China will still maintain reasonable and abundant liquidity, and the first half of 2022 will have greater flexibility than the second half of 2021; China's economic recovery will continue to normalize, and the opening of the financial market will introduce more foreign capital.

The establishment of the Beijing Stock Exchange will also further promote the IPO of SMEs.

  There are currently 770 A-share companies applying for IPO.

The KPMG report stated that this was mainly driven by numerous listing applications on the Science and Technology Innovation Board and ChiNext, demonstrating the confidence and recognition of investors and the market in these two sectors.

  As for Hong Kong stocks, the return of Chinese concept stocks may continue, and some companies that originally planned to go public in the United States may turn to the Hong Kong market.

The industry predicts that next year new economy companies such as technology, media and telecommunications, as well as biotechnology and health companies, will be the growth engines of IPOs.