The issuance of China Telecom’s A shares is known as “the easiest to win new shares in history”. However, for investors in the A-share market, even if it is the easiest new stock to win the lottery, it is still not easy for investors to win the lottery. In the August 9th issuance, China Telecom’s A shares were still subject to frantic purchases by investors. After the online call-back, the online investors hit a new winning rate of 0.95629301% (including the over-allotment part), effectively subscribing to The multiple is 104.57 times. Obviously, there are still many new investors who are unable to win the new A shares of China Telecom.
China Telecom’s A-shares have been constrained by newcomers, which is a manifestation of the madness of investors in the A-share market. Because the new shares are undefeated, those who win the new lottery can usually get a good return. Therefore, investors in the A-share market must fight for new shares. No matter what company is issuing, investors are rushing to subscribe. For this reason, the subscription software of the brokerage directly launched the “one-click new listing” and “bulk subscription”. No matter how many new shares are issued, investors only need to “one-click subscription” or “bulk subscription” to subscribe on the same day. All the stocks issued have greatly facilitated investors’ new creation. Under this circumstance, investors may have completed the subscription of new shares without clearly seeing the name of the stock they subscribed for. This has also contributed to the new frenzy of investors.
However, although the issuance of China Telecom’s A-shares has also been subscribed for more than one hundred times by investors, for investors who have won the lottery, the benefits of China Telecom’s A-share lottery are limited. It cannot be a “meat pick stock”, but just a “toothpick stock”. Therefore, for newcomers, whether they can hit China Telecom’s A-shares is actually of little significance. Even if they win the lottery, they will basically not bring much profit to investors, and they will not lose much if they do not win the lottery. , It’s nothing more than a “toothpick”.
Why is China Telecom A shares just a “toothpick”? This is first determined by the issuance of China Telecom’s A shares. China Telecom’s A shares are a super large-cap stock. The initial issue of A shares is 10.396 billion shares. Among them: the final strategic placement quantity is 5.183 billion shares. If the green shoe mechanism is used in full, the total number of shares issued will be 11.956 billion. Among them, 5.364 billion shares were issued online; 1.409 billion shares were issued offline (including 423 million shares without lock-up period and 986 million shares with lock-up period). Such a huge circulation disk is obviously difficult to be speculated.
Not only that, the valuation corresponding to the issue price of China Telecom’s A shares is not low. Although the issue price of China Telecom’s A shares is 4.53 yuan per share, the absolute issue price is not high, but the corresponding 2020 diluted P/E ratio is 20.18 times. In fact, the price-earnings ratio of China Unicom, which is currently listed on the A-share market, is also hovering around 20 times. This means that the valuation of the issue price of China Telecom’s A shares has been in line with the valuation of China Unicom’s secondary market price. Its secondary market has almost lost the necessary space for speculation.
Of course, China Telecom is a company with stable performance. But for the capital market, stable performance is important, but more important is the rapid growth of performance. But it is clear that China Telecom has passed the stage of rapid growth in its performance. For example, in the first quarter of 2021, operating income was 106.317 billion yuan, an increase of 12.68% over the same period last year; net profit was 6.504 billion yuan, an increase of 10.48% over the same period last year; net profit attributable to the parent was 6.441 billion yuan, an increase of 10.63% over the same period last year. Judging from the operating results in the first quarter, although the overall performance is good, the growth rate of about 10% is indeed lacking the necessary attractiveness for the market. According to the newly disclosed semi-annual report, as of June 30, the profit attributable to shareholders was 17.743 billion yuan, an increase of 27.2% year-on-year, but the company’s operating income was 219.2 billion yuan, an increase of 13.1% year-on-year. It can be seen that the company’s revenue growth is still “quite stable.”
What is especially important is that from an investment perspective, buying China Telecom A shares is obviously not as valuable as buying China Telecom H shares. China Telecom is a large aircraft carrier stock and is not suitable for speculation. But in terms of investment, China Telecom’s H shares are obviously more valuable. After all, it is the same company. On the day China Telecom’s A shares were issued at a price of 4.53 yuan, the share price of its H shares was only 2.87 Hong Kong dollars (approximately 2.39 yuan), which was only 52.74% of the A-share issue price. For the same China Telecom stock, the equity of H shares and A shares are the same, but H shares are much lower than A shares. Obviously, the investment value of China Telecom’s H shares is higher than that of A shares.
Moreover, although A-shares and Hong Kong stocks are two different markets, due to the interconnection between the two places, investors in the A-share market can also invest in Hong Kong stocks through Southbound Stock Connect, that is, A-share investors can also invest in Hong Kong stocks. Buying H shares of China Telecom. It is precisely because of this that investors are playing new China Telecom A shares more simply to win the speculation when China Telecom’s new A shares are listed. As far as investment is concerned, buying China Telecom’s H shares is obviously a more appropriate choice.Return to Sohu to see more
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