event:
The central economic work conference proposed to "fully implement the stock issuance registration system". On the evening of October 10, Shanghai and Shenzhen stock exchanges issued the stock listing rules of Shanghai Stock Exchange (Draft for comments) and the stock listing rules of Shenzhen Stock Exchange (Draft for comments).
comment:
The historical significance of registration system reform: building a more flexible and diversified capital market
Capital market is an important part of China's market-oriented factor reform. Capital market reform has an important position of "pulling one hair and moving the whole body". With increasing the proportion of direct financing as the main line, China has been steadily promoting the capital market reform represented by the stock market. From the history of the registration system, the opening of the science and innovation board in Shanghai Stock Exchange in 2019 means that the pilot of the registration system will be officially implemented, and the pilot of the registration system will be opened on the gem of Shenzhen Stock Exchange in 2020. The central economic work conference in 2021 clearly pointed out that "fully implement the stock issuance registration system", pointing out the direction for the reform of the capital market next year. We believe that it is mainly the unification and formal implementation of the pilot systems of the registration systems of the science and innovation board, the gem and the Beijing stock exchange, as well as the implementation of the registration system of the main board market. The reform of stock issuance registration system is of great significance: 1) the capital market plays a more important role in high-quality development, and speed up the status and reform of market-oriented allocation of capital factors. 2) The reform of registration system is conducive to stimulate scientific and technological innovation, promote the combined development of technological elements and capital elements, and promote the support of capital market for science and technology. 3) Broaden listing standards and listing sources represented by private enterprises and small and medium-sized enterprises. China's stock market originated from the difficulty relief of state-owned enterprises. The reform of registration system helps private enterprises, small and medium-sized enterprises and other market subjects to participate in the capital market.
The essence of the registration system reform: decentralization of listing audit, increased importance of information disclosure, and more diversified delisting system
The basic system of the stock market has been continuously improved. The reform of the registration system is a systematic project including various systems such as stock issuance, trading and delisting. From the issuing side, at the current stage, China's registration system reform is mainly reflected in the transformation of audit power: the listing audit is changed from the CSRC to the exchange to audit the issuance materials, and the CSRC decides whether to register according to the audit opinions of the exchange. From the perspective of listing standards, it emphasizes the sustainable profitability of enterprises, sets more diversified and inclusive listing conditions, and pays more attention to the sustainable operation ability and information disclosure of enterprises. From the perspective of supervision of listed companies, according to the administrative measures for information disclosure of listed companies and other rules, while urging listed companies, shareholders and relevant information disclosure obligors to disclose information truthfully, accurately, completely, timely and fairly, the exchange highlights the main responsibility and importance of information disclosure. While encouraging listed companies to actively disclose voluntary information related to investors' value judgment and investment decision-making, refine the norms of voluntary information disclosure, and make it clear that voluntary information disclosure should also maintain continuity and consistency, and selective disclosure is not allowed. From the delisting system, the delisting standards will be more diversified. Referring to the existing standards, compulsory delisting can be divided into four categories: transaction, financial, normative and major violations.
Long term impact on the stock market: the "new" pricing of stocks will be more market-oriented, and the secondary liquidity will be further differentiated
The market of registration system is a freer and more inclusive market. Referring to the capital markets of overseas developed countries, the long-term impact of registration system issuance is that the quality differentiation of listed companies is more serious at the same time of market expansion, resulting in the differentiation and difference of liquidity in the capital market.
In contrast, in China's capital market, as the issuance and pricing of new shares under the registration system are more market-oriented and the new inquiry is more flexible, we expect that after the comprehensive registration system, the market-oriented inquiry mechanism will hand over the pricing power of issuance to the market, and the proportion of "broken issuance" may increase. From the perspective of the secondary market, the implementation of the registration system is bound to be accompanied by the expansion of the equity market, and the quality of listed companies is more important. Referring to the capital markets of overseas developed countries, we believe that the liquidity of the secondary market will be further divided, and the trend of capital concentration to "core assets" and "hot track" will be more obvious.
Investment suggestions:
The "full implementation of the registration system" is of great significance to the securities industry. The investment banking business will change from the traditional "channel business" to "investment research pricing". The strengthening of information disclosure requirements has higher requirements for the compliance requirements and intermediary responsibilities of securities companies, and the importance of the professional pricing ability and compliance risk control ability of securities companies has increased.
Investment in the securities industry "depends on market sentiment in the short term, performance growth in the medium term and the breadth and depth of the capital market in the long term". From the current logic, in the short term, under the catalysis of valuation switching at the end of the year and "spring agitation", securities companies with high performance growth and undervalued value are more attractive to institutional investors. In the medium term, the fundamentals of the securities industry continue to improve, and the performance is expected to maintain steady growth. In the long run, under the background of the in-depth promotion of capital market reform, the securities industry is at a historic turning point. Under the catalysis of factors such as the steady upward roe of securities companies, we maintain the "overweight" rating of the securities industry. From the perspective of individual stocks, we believe that the differentiation of the industry pattern in the past 22 years will intensify. We recommend leading securities companies and securities companies with competitive advantages in investment consultants, derivatives markets and other segments.
Risk tip: the economic recovery is less than expected; Policy reform lags behind; The long-term interest rate was lower than expected.
