The falling market in recent days is not very friendly for new shares. The increase of breaking hair directly challenges the follow-up and investment business of securities companies’ science and innovation board.
As of March 11 this year, since the beginning of the weak market in the third quarter of 2021, 93 new shares on the science and innovation board have been listed, of which 25 new shares have broken, with a breaking rate of nearly 30%. A total of 11 securities companies, including Citic Securities Company Limited(600030) , Huatai Securities Co.Ltd(601688) , China International Capital Corporation Limited(601995) and other leading securities companies, act as sponsors of the above 25 listed companies.
Or affected by a broken break, 11 brokers have gone through their related subsidiaries to follow and invest through their related subsidiaries. The total float losses of 11 brokers through their related subsidiaries, and the total total float losses of 11 brokers have reached $894 billion. Of which, the China Pacific Insurance (Group) Co.Ltd(601601) 99995 tenthousand yuan.
The picture shows the related situation of securities companies with investment and floating losses
Although the floating profit or loss of securities companies can not be determined in a short time, it is really “very hurt” in the short term, whether for sponsors or secondary market participants.
11 recommendation agencies were injured
Citic Securities Company Limited(600030) participated in 5 of the 25 broken new shares Haitong Securities Company Limited(600837) , Huatai Securities Co.Ltd(601688) each participated in 4; Minsheng securities, China International Capital Corporation Limited(601995) and Guotai Junan Securities Co.Ltd(601211) respectively participated in 3 Shenwan Hongyuan Group Co.Ltd(000166) participated in 2 Sinolink Securities Co.Ltd(600109) , Goldman Sachs Gaohua, China Securities Co.Ltd(601066) , Guoyuan Securities Company Limited(000728) each participated in one.
Generally speaking, securities companies earn a lot due to recommendation and underwriting. According to the statistics of easy to understand data, the underwriting and recommendation expenses of the above-mentioned breaking new shares reached 3.935 billion yuan, of which the underwriting and recommendation expenses of Baiji Shenzhou, which China International Capital Corporation Limited(601995) cooperates with Goldman Sachs Gaohua, were the highest, reaching 471 million yuan, followed by the Tianyue advanced project, which Guotai Junan Securities Co.Ltd(601211) cooperates with Haitong Securities Company Limited(600837) cooperates with with 320 million yuan.
Accordingly, the leading securities companies generally sold more shares with investors, China International Capital Corporation Limited(601995) with investors in xidiwei reached 3.2 million shares, Haitong Securities Company Limited(600837) with investors in Maiwei biological reached 2.87 million shares, Citic Securities Company Limited(600030) with investors in Yahong pharmaceutical reached 3.3 million shares, Huatai Securities Co.Ltd(601688) with investors in Jing-Jin Electric Technologies Co.Ltd(688280) reached 4.43 million shares. Among the 11 securities companies, more than half of the securities companies have a single follow-up investment of 700000 to 1 million shares.
As the “most expensive new share since 2021”, Baiji Shenzhou is one of the representatives of breaking new shares China International Capital Corporation Limited(601995) as the sponsor of Baiji Shenzhou A shares, as well as the follower and underwriter, the floating loss on the first day of listing exceeded 100 million yuan. As a sponsor, Goldman Sachs Gaohua can not escape this disaster.
China International Capital Corporation Limited(601995) there are three main reasons why we are optimistic about Baiji Shenzhou: first, the end-to-end international new drug development and commercialization platform; second, the global layout of multi-level pipelines, with core varieties entering the harvest period; third, the self built R & D system and abundant reserves of early technology platforms.
However, at present, Baiji China is on the cusp of the storm again. On March 10, the SEC of the US Securities Regulatory Commission announced that five Chinese companies will be included in the provisional list of the foreign company Accountability Act, including Baiji Shenzhou. The list shows that if a foreign listed company fails to submit the report required by the U.S. listed company accounting oversight committee for three consecutive years, the SEC has the right to delist it from the exchange. Affected by the news, Baiji Shenzhou A shares and H shares both dived on March 11. As of the close of the day, they fell 4.11% and 4.91% respectively. As a result, the floating losses of China International Capital Corporation Limited(601995) and Goldman Sachs Gaohua follow-up investment increased again.
Citic Securities Company Limited(600030) “medicine” can’t afford
Whether the fundamentals are good enough is an important factor to determine the breaking of new shares. Among these breaking new shares, 8 have the common feature of continuous decline in business performance. On the stage of science and innovation board, they drag the small tail of “U”, especially in the pharmaceutical industry.
The figure shows the performance of 25 new shares on the science and innovation board
The financial Associated Press reporter noted that among the five new shares of the science and Innovation Board sponsored by Citic Securities Company Limited(600030) there are four pharmaceutical companies with loss performance, namely Yahong pharmaceutical, Dizhe pharmaceutical, Jiangsu Gdk Biological Technology Co.Ltd(688670) and Liaoning Chengda Biotechnology Co.Ltd(688739) .
Liaoning Chengda Biotechnology Co.Ltd(688739) in terms of performance, the company’s performance express shows that the company achieved an operating revenue of 2.088 billion yuan in 2021, with a year-on-year increase of 4.63%, but the net profit attributable to the owner of the parent company decreased by 2.80% year-on-year, realizing 892 million yuan Liaoning Chengda Biotechnology Co.Ltd(688739) attributable to the owner of the parent company, the net profit after deducting non recurring profit and loss was 863 million yuan, with a year-on-year increase of 2.13%. In view of this performance fluctuation, Liaoning Chengda Biotechnology Co.Ltd(688739) said that it was mainly due to the decrease in the fair value of the company’s investment compared with the same period of the previous year.
According to the performance express disclosed by Yahong pharmaceutical, the company’s total operating revenue in 2021 was 4600 yuan, no operating revenue was generated in the same period of last year, and the net profit loss attributable to the shareholders of the parent company was 238 million yuan. Yahong pharmaceutical also expects that the company will continue to have large-scale R & D investment in the next few years, the R & D expenses will continue to be at a high level, the unprofitable state is expected to continue, and the accumulated outstanding losses may continue to expand in the short term.
Dizhe pharmaceutical’s profit decreased both in 2021. In 2021, the operating income was about 10.29 million yuan, a year-on-year decrease of 62.95%. The loss attributable to shareholders of listed companies was about 670 million yuan, with a basic loss of 1.86 yuan per share China Industrial Securities Co.Ltd(601377) released the Research Report of “prudent shareholding increase”, which predicted that the average net profit loss of the company in 2022 would be 846 million yuan.
Jiangsu Gdk Biological Technology Co.Ltd(688670) also saw a double drop in profits. According to the company’s performance express, in 2021, its operating income was 396 million yuan, a year-on-year decrease of 32.85%, and the net profit attributable to the owner of the parent company was 822863 million yuan, a year-on-year decrease of 46.91%. The net profit attributable to the owner of the parent company after deducting non recurring profits and losses was 662234 million yuan, a year-on-year decrease of 59.09%, and the basic earnings per share was 1.12 yuan, compared with 2.35 yuan in the same period of the previous year, A year-on-year decrease of 52.34%.
China International Capital Corporation Limited(601995) sponsor and follow-up investment Baiji China is also not optimistic. According to the express, the company achieved an operating revenue of 7.589 billion yuan in 2021, a year-on-year increase of 257.9%; The net profit attributable to the parent company lost 9.748 billion yuan, compared with 11.384 billion yuan in the same period last year.
So far, the company has suffered losses for four consecutive years.
strengthen the risk sharing awareness of sponsor securities companies
In 2019, the CSRC made it clear in the opinions on the implementation of establishing a science and innovation board and pilot registration system in Shanghai stock exchange that it would try out the “follow-up investment” system of relevant subsidiaries of sponsors. One of the starting points of the establishment of the system is to strengthen the risk sharing awareness of sponsor securities companies.
According to the guidelines on the issuance and underwriting of shares on the science and Innovation Board of Shanghai Stock Exchange issued by Shanghai Stock Exchange, the recommendation institution is required to set up an alternative investment subsidiary or the securities company that actually controls the recommendation institution shall set up an alternative investment subsidiary according to law to participate in the IPO strategic placement of the issuer with its own funds. The subscription ratio is 2% to 5% of the issuer’s initial public offering shares, and the lock-in period is 24 months.
Wind data shows that over the past two years since the opening of the science and innovation board, there have been 393 listed companies, with a total IPO Fund of 515.2 billion yuan. 24 securities companies have participated in the IPO recommendation and underwriting of listed companies on the science and innovation board. Among them, Citic Securities Company Limited(600030) , Huatai Securities Co.Ltd(601688) , Haitong Securities Company Limited(600837) , China International Capital Corporation Limited(601995) , China Securities Co.Ltd(601066) and other five leading securities companies participated in the IPO of at least 200 enterprises, raising more than 290 billion yuan. A person from a securities firm in Beijing said that due to the great disparity in the investment banking strength of securities firms, there was also an obvious “Matthew effect” in the follow-up investment market of securities firms, and there was a phenomenon that large securities firms crushed small securities firms.
According to the statistics of the financial Associated Press, among the 393 listed companies, the latest share prices of 79 companies are lower than the initial price, while the securities companies of 91 science and Innovation Board companies have ended the lock-in of shares regularly and ushered in the lifting of the ban. An investment banker from a southern securities firm told the financial Associated Press: “whether to sell after the lifting of the ban, the proportion of sales, and the resulting profit and loss are related to the pricing and valuation of the primary market and the overall trend of the secondary market at the time of issuance.”
Chen Mengjie, chief strategist of YueKai Securities Research Institute, told the financial associated press that as an institutional investor, the strategic placement of securities companies is more long-term value investment. There are many factors to consider. They will not only consider the yield after the lifting of the ban, but also analyze and judge the future market, industry and company operation in combination with their own investment research system, Comprehensively evaluate the long-term value of the subject company.
