On December 10, Walvax Biotechnology Co.Ltd(300142) announced the termination of planning to issue H shares. According to the statistics of Securities Daily, since this year, at least five A-share companies have stopped planning to issue H shares, and one has suspended the process of issuing and listing H shares. According to the announcement contents issued by various companies, “affected by covid-19 pneumonia epidemic factors”, “China’s economic growth, A-share and Hong Kong stock market fluctuations” and “the company’s current operation” are the main reasons for terminating the planning of H-share issuance.
For example, Chempartner Pharmatech Co.Ltd(300149) announced on January 26 that in view of the changes in the market environment and in combination with the company’s development plan, in order to safeguard the interests of the majority of investors, after careful decision-making, the company decided to terminate the planning for the issuance of H shares and withdraw the application documents.
China Everbright Bank Company Limited Co.Ltd(601818) Zhou Maohua, a macro researcher of the financial market department, told the Securities Daily that from the relevant information, the reasons for the termination or suspension of H-share listing of the above companies are different, but the common reasons point to the overseas epidemic changes, which exacerbated the uncertainty of the global economic development prospect and affected the sentiment of investors in the Hong Kong stock market, Some enterprises are worried that it is difficult to obtain a better valuation by issuing H shares in the current environment.
“At present, the Hong Kong stock market is relatively depressed and the valuation is low. The timing of listing and financing is not the best.” Tian Lihui, President of the Institute of financial development of Nankai University, told the Securities Daily. As of the closing on December 10, Hong Kong’s Hang Seng Index closed at 23995.72 points, down 13% since the beginning of the year.
According to the data, as of December 12, there were 138 listed enterprises in ah. The A / h premium rate of 137 companies is positive, of which 69 companies have a / H share premium rate of more than 100%, which is equivalent to that the price of Hong Kong shares is less than half of the price of a shares, which indicates that the price of Hong Kong shares is relatively undervalued to a certain extent.
Issuing H shares is one of the important means for A-share companies to broaden financing channels. On the one hand, issuing H shares will enable listed companies to raise more funds, improve the company’s liquidity, and give the company more room to expand its business. On the other hand, by listing in “a + H” mode, the company can make full use of the advantages of the two markets, and its subsequent financing is not subject to the rules and conditions of the single market, further broadening the subsequent financing channels and financing methods.
“The issuance of H shares by A-share listed companies will increase the total share capital, dilute the earnings per share to a certain extent, and pose a negative impact on the short-term stock price. However, in the medium and long term, listed companies can obtain financing, further improve corporate governance and expand overseas markets, so it constitutes a long-term good.” Zhou Maohua said.
What types of companies are more suitable for issuing H shares? According to the data, as of December 12, in the past month, the daily consumption, information technology, medical care and other industries accounted for a relatively high proportion in the Shenwan industry of the “top ten” companies of Shanghai Shenzhen Gangtong.
The data also show that since this year, the Hong Kong Stock Exchange has ushered in the listing of 88 companies, and the accumulated financing of IPO of new shares is 307.7 billion yuan. From the perspective of Hang Seng’s industry classification, there are relatively many companies issuing H shares in medical care, real estate construction, information technology and other industries.
“The Hong Kong stock market favors subdivided leading stocks in cyclical industries such as medicine.” Chen Li, chief economist of Chuancai securities and director of the Research Institute, said in an interview with Securities Daily that it is very attractive for companies to expand their international business to list in Hong Kong. It is worth noting that the trading rules and Listing Rules of Hong Kong stocks are slightly different from those of the mainland. Enterprises with insufficient overseas expansion are not suitable for listing in Hong Kong.
(Securities Daily)
