Key investment points:
The pilot of public offering REITs was deepened, and the detailed rules of raising policies were implemented to help the sound development of China’s REITs market. On April 15, 2022, public infrastructure REITs welcomed the highly concerned REITs business guidelines No. 3 – newly purchased infrastructure projects (Trial) (hereinafter referred to as “REITs business guidelines No. 3”). The introduction of the raising mechanism marks the improvement of China’s REITs market supporting system. “No. 3 REITs business guidance” mainly draws lessons from the experience of overseas REITs market and refers to the relevant provisions on major asset restructuring and refinancing of listed companies. The main contents include: (1) clarifying the conditions for newly purchased infrastructure projects; (2) Clarify the procedural arrangements for the purchase of infrastructure projects; (3) Clarify information management and requirements for suspension and resumption of trading; (4) Clarify the sale and pricing arrangements of assets purchased through raising. As the basic rules for newly purchased infrastructure projects and related raising, information disclosure and other matters during the existence of public REITs, this document stipulates the key matters such as important nodes in the whole business process of newly purchased projects and the sale of raised shares. The “No. 3 REITs business guidance” takes information disclosure as the core, strictly compacts the responsibilities of market subjects such as intermediaries, and highlights the characteristics of REITs’ asset listing platform in relevant links.
The raising mechanism helps the healthy growth of public REITs. Institutions have made preparations for fund raising, and the market expansion of REITs is imminent. Referring to the development of overseas REITs, the raising mechanism of infrastructure REITs plays an important role in the scale growth of REITs market. According to the research of Huaxia Fund, in recent years, the annual raising scale of American REITs has reached US $30-50 billion, accounting for about 2% – 4% of the total market value of that year, which is the main way to increase the scale of REITs. The market has long been looking forward to the detailed rules for raising REITs by public offering in China. As early as the “No. 3 REITs business guidance” was officially announced, many public offerings have made corresponding preliminary preparations for raising REITs by infrastructure, such as system, personnel, investment research, asset screening and so on. Wind data shows that as of April 15, 2022, the overall market scale of China’s public REITs has reached 44.6 billion yuan. With the deepening of policy norms and market mechanism, public REITs have the conditions for healthy growth in hardware and software, and it is expected to usher in the rapid expansion of the public REITs Market in the future.
REITs market adjusted this week, with AVIC Shougang biomass REIT (- 2.63%) leading the decline. This week (2022.4.112022.4.15), the REITs index fell, of which the REITs index fell (- 0.35%) to close at 133.53 points, the management rights REITs index fell (- 0.64%) to close at 130.86 points, and the property rights REITs index fell (- 0.1%) to close at 135.75 points. The average increase this week was – 0.18%, of which AVIC Shougang biomass REIT (- 2.63%) led the decline. Unfashionable “produce 101”, the average price rose by 33.53%, of which the first water REIT (65.78%), the Beijing Centergate Technologies (Holding) Co.Ltd(000931) REIT (49.56%), and the Shenzhen Yan Tian Port Holdings Co.Ltd(000088) innovation REIT (45.52%) were the top three.
The transaction activity of REITs was basically flat this week. The average turnover rate of 11 public offering REITs this week was 1.44%, the average transaction value was 183million yuan, and the trading volume was 34million; Last week, the average turnover rate was 1.36%, with an average turnover of 173 million yuan and a turnover of 33 million copies. The weekly turnover of 11 public offering REITs was 915 million yuan, with a trading volume of 172 million copies, compared with the previous week (5.52%) and (6.04%), and the corresponding historical quantile levels since listing were 48.78% and 48.78% respectively; The weekly turnover rate was 1.39%, corresponding to the historical quantile level of 39.02% since listing
Risk warning: the future operation of REITs basic assets project is uncertain; The future cash flow calculated in the prospectus may not accurately reflect the actual situation; The progress of raising and issuing was less than expected.
