Dialectical view of new shares breaking frequently
Recently, a succession of new shares broke the nerves of investors.
According to statistics, since the beginning of this year, more than half of the new stocks have broken, and the stocks that fell below 20% and 30% of the issue price on the first day of listing frequently appeared.
Investors repeatedly shouted that "winning the lottery is like a gun", and individual new stocks became "hot potatoes", and up to one-third of the lottery winners abandoned their purchases.
Why do IPO breakouts occur frequently?
There are two main reasons.
One is the impact of market conditions.
Since the beginning of this year, due to the influence of geopolitical conflicts, the Fed’s interest rate hike, and the spread of the new crown pneumonia epidemic, the A-share market has been adjusted more, and the market sentiment has been slightly sluggish, and the performance of new stocks has also been affected.
The second is related to the "three highs" issuance of new shares.
Many new shares were issued at high prices, high price-earnings ratios, and high fundraising amounts, and faced a return to valuation after listing.
Many of the stocks issued at high prices have suffered losses in corporate performance. In the face of issuance pricing that is divorced from fundamentals, investors have chosen to "vote with their feet".
The breakout of new shares is a manifestation of the gradual functioning of the market-based value discovery function.
In the past period of time, the A-share market has frequently seen "three low" new stocks with low issue price, low price-earnings ratio and low fundraising amount, and the phenomenon of "centralized quotation" and "group pressure reduction" by institutions is prominent.
In order to make the pricing of IPOs more reasonable, the implementation of the new price inquiry regulations in September last year strengthened the market-oriented pricing of IPOs, made the quotation game more difficult, and reduced the arbitrage space in the middle, breaking the myth of "invincible IPOs" and promoting IPO returns. Back to rationality.
In other words, a certain percentage of new shares break, is the only way for A shares to move towards a mature market.
However, there have been frequent new stock breaks in recent times, and there are also issues that need attention and reflection behind them.
After all, a new stock break, especially a sharp break, will bring real losses to investors.
The frequent breakouts and large-scale abandonment of purchases caused by the issuance of "three highs" also undermine the function of the capital market to provide direct financing for enterprises and serve the real economy.
The pricing power of some inquiries may be questioned.
The "three highs" of new shares are frequently issued, which is closely related to the high prices quoted by some inquiry institutions.
In order to obtain a higher proportion of underwriting and sponsorship fees, in the process of corporate IPO, some inquiries tend to set prices higher, which objectively drives the price of new shares to rise, increasing the probability of new shares breaking.
The registration system emphasizes the marketization of issuance pricing. How to set the price of new shares more reasonably tests the research ability and professional ability of the inquiry institution, and is also an important manifestation of the competitiveness of the institution in the future.
Inquiry institutions need to change the behavior path of focusing on games and ignoring research in the past, effectively improve their research and investment capabilities, balance the interests of enterprises and investors, and make objective and rational quotations based on the company's fundamentals, improve the marketability of stocks, and enhance their own market influence. .
After the implementation of the new inquiry regulations, the "three highs" are frequently issued, which reflects that the inquiry mechanism still has certain shortcomings, and it is necessary to further improve it.
For example, it can be considered to moderately increase the high price exclusion ratio from the current "no more than 3%, no less than 1%", so as to promote a more balanced inquiry game and set a more appropriate price for new shares.
In addition, listed companies also need to be vigilant about high issuance prices that are out of the fundamentals.
Large-scale breakouts and large-scale abandonment of purchases are undoubtedly harmful to the reputation of listed companies, and some companies even lead to insufficient fundraising.
Listed companies cannot blindly pursue high-premium issuance, but should seek listing on a down-to-earth basis and pursue development with one heart and one mind.
Only when its own value is actually improved can the growth of the company's market value come naturally, and its intrinsic value can be more reasonably reflected.
In any case, with the comprehensive advancement of the registration system in the future, the breaking of new shares may become the norm. The myth of "invincible new shares" is a thing of the past, and "new shares" has also become a kind of venture capital.
Investors need to change the mindset of "blindfolded to win", and in the selection of new stocks, from "every new must hit" to preferred individual stocks, pay more attention to corporate fundamentals.
(Source of this article: Economic Daily Author: Li Hualin)