The first batch of infrastructure public offering REITs listed collectively closed up, experts suggest a rational view of investment value
Source: Red Star Capital Bureau
On June 21st, infrastructure public offering REITs (real estate investment trust funds), a brand-new product officially debuted in the capital market, and the trillion-level investment products that the market awaited finally met with investors. As of the close of the day, 9 products have been popular across the board. The largest increase in Shekou Production Park reached 14.72%, and the total turnover of the 9 products exceeded 1.8 billion yuan.
Chen Fei, director of the bond department of the China Securities Regulatory Commission, stated at the listing ceremony of the first batch of infrastructure public offering REITs that he hopes that the original stakeholders, intermediaries and other market participants will earnestly return to their positions and fulfill their responsibilities, and that the majority of investors will correctly understand product features, establish risk awareness, and participate rationally transaction.
Industry insiders believe that because the first batch of projects are “select the best among the best” and the A-shares have always had a trend of “speculation in new”, it is not ruled out that the first batch of publicly offered REITs may have a high premium on the first day of listing, but the intrinsic value of publicly offered REITs It is stable and does not support skyrocketing and falling. Investors are advised to rationally view the investment value of the first batch of publicly offered REITs.
As of the close, Shekou Industrial Park led the gains by 14.72%, and Shougang Green Energy rose 9.95%.
The first day’s price limit is 30%
REITs, or real estate investment trust funds, refer to standardized financial products that are publicly traded on stock exchanges, through securitization, to convert real estate assets or equity with continuous and stable income into listed securities with strong liquidity.
According to different issuance methods and fund-raising targets, REITs are divided into public REITs and private REITs. For investors, public REITs are a low-threshold investment tool for real estate. Generally speaking, they have the advantages of better long-term returns and more stable dividends, and have good investment value. In addition, as alternative investment products, public REITs have low correlation with other mainstream investment products, and can effectively diversify the risk of investment portfolios.
Simply put, what REITs invest in is not familiar stocks and bonds, but real estate, and real estate after special treatment (ie, asset securitization, ABS). Therefore, in terms of product structure, REITs do not directly buy a building in the real estate market and own the sovereignty of this building, but buy the ABS products issued by this building, and ABS products hold 100% of this building. Then REITs also own this building.
The first batch of 9 infrastructure public offering REITs products listed and traded, marking the official landing of the domestic infrastructure public offering REITs pilot work, which is of great significance for promoting the high-quality development of infrastructure, enriching capital market investment and financing tools, and enhancing the capital market’s ability to serve the real economy. .
It is reported that on the first day of the listing of infrastructure public offering REITs, the previous closing price shown in the real-time market information is the infrastructure fund offering price. Infrastructure public offering REITs have a limit of 30% on the first day of listing, and a limit of 10% on the first day of non-listing.
Specifically, the first batch of 9 publicly offered REITs products are Zhangjiang REIT, Zhejiang Hanghui, Beijing Capital Water, Soochow Suyuan, GLP, Shougang Green Energy, Shekou Industrial Park, Guangzhou Guanghe and Yangang REIT. Their underlying infrastructure projects are located in key areas such as the Beijing-Tianjin-Hebei region, the Yangtze River Economic Belt, the Guangdong-Hong Kong-Macao Greater Bay Area, and the Yangtze River Delta, covering five mainstream infrastructures including sewage treatment, garbage treatment and biomass power generation, industrial parks, toll roads, and warehousing logistics. Facilities area.
On June 7, the first batch of infrastructure public offering REITs products were formally established. According to previous announcements, the first batch of infrastructure public offering REITs received wide attention and recognition from the market. The total number of effective subscriptions was nearly 1.5 million, and the net raised funds exceeded 31.4 billion yuan. The average strategic placement ratio was 66.8%, and the average effective subscription multiple was nearly 8. Times.
The market size is expected to exceed one trillion yuan
“The pilot public offering of REITs is another important reform and innovation measure for the capital market.” Li Xing, chief market analyst at Yuekai Securities Research Institute, said that public offering of REITs can effectively revitalize existing infrastructure assets, expand infrastructure equity financing channels, and optimize social resource allocation , To guide medium and long-term funds to participate in the capital market, and to provide investors with more diverse investment tools and products. At the same time, the pilot implementation of public REITs will further promote innovative investment and financing mechanisms in the infrastructure sector, deepen the structural reform of the financial supply side, and enhance the effectiveness of capital markets in serving the real economy.
According to regulations, during the listing of public REITs, in principle, no less than one liquidity service provider is selected for each product to provide services such as bilateral quotation, and to improve the liquidity mechanism of the secondary market. The reporter noticed that the fund managers of the 9 publicly offered REITs have all issued announcements about market makers. Specifically,CITIC Securities、CICC、Guotai Junan、GF SecuritiesMany brokerages are listed among them.
Experts remind investors that when participating in public REITs investment, public REITs subscribed by on-market securities accounts can directly participate in the Shanghai and Shenzhen Stock Exchange; if investors use OTC fund accounts to subscribe, they should first transfer to custody Only on-exchange securities operating institutions can participate in on-exchange trading on the Shanghai and Shenzhen Stock Exchanges. The transfer of custody of public REITs is consistent with the transfer of custody of other public funds.
In addition, the reporting time for investors to participate in the collective auction of public REITs is from 9:15 to 9:25, from 9:30 to 11:30, and from 13:00 to 15:00 on each trading day. The number of declarations for investors participating in public REITs bidding transactions should be 100 or an integral multiple thereof. If the sale balance is less than 100 copies, they should declare for one-time selling. If investors participate in public REITs inquiries and block transactions, the number of single declarations should be It is 1000 copies or an integer multiple thereof.
“Compared with the mature overseas capital market, the market size of my country’s public REITs is expected to exceed one trillion yuan in the future.” Li Xing predicts that in the future, public REITs are expected to further integrate state-owned assets and local capital, improve the local state-owned asset investment and financing system, and provide social capital. More diverse and flexible exit methods to attract them to participate in infrastructure projects.
Intrinsic value stability
The 9 publicly offered REITs with the first “halo” products have attracted attention since the declaration, which also means that the first batch of products may have a higher premium in the early stage of the market. According to the research department of CICC, from the perspective of overseas markets, similar stocks of some REITs products will show a sharp rise or fall after they are listed. It is recommended that investors take a rational look at the investment value of the first batch of listed publicly offered REITs and avoid chasing rises and falls.
“There may be some public investors who do not understand publicly offered REITs and regard publicly offered REITs as stocks, and equate subscriptions with’stocks for new’, and the listing of publicly offered REITs as’speculation of new shares.’ The underlying assets of the first batch of publicly offered REITs It is an infrastructure project with sustainable operation capability, which can bring continuous and stable returns to investors, but its growth is incomparable with that of listed companies in start-up or high-tech industries. From the perspective of business fundamentals and growth logic , The intrinsic value of publicly offered REITs is stable and does not support skyrocketing and falling.” The AVIC Fund team said.
“Public REITs are products with cash dividend income as the main income. Under the circumstance that future dividends are expected to remain unchanged, the higher the purchase price, the lower the yield after buying, and may even be lower than the yield of treasury bonds of the same maturity. Rate.” Ping An Securities pointed out.
Galaxy Securities’ self-operated investment headquarters believes that after the issuance and listing of public REITs funds, the adjustment of fund investment strategies, income distribution, expansion and mergers, asset evaluation report updates, expiry exits, and fund holders’ meeting issues may be affected. In the coming fund market price fluctuations, investors also need to understand the risk of price fluctuations brought about by such matters. At the same time, as a publicly traded product, it will be interfered by various factors such as stock market fluctuations, short-term speculation by investors, changes in capital interest rates, and news speculation, which will cause prices to deviate from the reasonable anchor value of the underlying projects.
Chen Fei, director of the bond department of the China Securities Regulatory Commission, delivered a speech at the listing ceremony of the first batch of infrastructure public offering REITs. The principle of “zero tolerance”, adhere to the “four awes, one force”, and strive to support assets with mature operations, stable cash flow and high market recognition to realize equity financing by relying on REITs; adhere to strict supervision and purify the market ecology; summarize the pilot experience in a timely manner, Strengthen the improvement of key systems and promote the healthy development of the market.
★List of key points for ordinary investors to participate in public offering REITs★
1. How to buy?
Let’s first look at the method of sale. Public REITs are divided into online and offline offerings. Offline investors are required to be professional institutional investors. In fact, it is similar to offline launching of new REITs. This part is the participation of professional institutional investors.
For small and medium-sized investors, the purchase of publicly offered REITs can be subscribed through off-site direct sales and agency agencies, or through the channel of on-site subscription through brokers. Investors who participate in the on-market subscription of infrastructure funds shall hold an on-market securities account; investors who participate in the off-market subscription of infrastructure funds shall hold an over-the-counter fund account.
To purchase through a securities account for trading stocks, you must first open an account at a brokerage firm. Since these 9 publicly offered REITs are listed on the Shanghai Stock Exchange and the Shenzhen Stock Exchange respectively, you need to have accounts on two exchanges. Generally speaking, they will be opened at the same time when opening an account at a brokerage firm. Open.
It should be noted here that it often takes one day for a broker to open an account, because investors cannot subscribe for an account when they open an account on the same day.
After opening the securities account, you also need to open the purchase authority of the infrastructure fund and sign the risk disclosure letter. This is generally in the authority opening section of the brokerage APP.
After the permission is opened, some brokerages submit the subscription application on the “Exchange Fund Application and Redemption” interface. If the entry is not found, they can also subscribe directly through the search code.
2. What is the minimum subscription amount?
On-site subscriptions on the Shenzhen Stock Exchange are based on 1,000 as the minimum subscription threshold, and most on-site subscriptions on the Shanghai Stock Exchange are based on 1,000 yuan as the minimum subscription threshold. The minimum off-market subscription threshold for each publicly offered REITs is different, with a minimum of 100 yuan and a minimum of 1,000 yuan.
3. What is the fund rate?
In terms of fee rate, the subscription fee rate of publicly offered REITs is not high, and the subscription fee rate of less than 1 million (or 10 million) is 0.5%-0.6%, which is significantly lower than that of equity funds and similar to bond funds.In terms of management fees, except BoseraChina Merchants ShekouThe REIT of the industrial park has a fixed fee rate of 0.3%/year, and the remaining 8 only use a fixed fee rate plus a variable fee rate combination model, and the variable fee rate is linked to the fund’s performance.
4. Do you need a “lottery”?
On May 31, the first day of the first batch of public offering REITs, if the total raised scale of public investors reaches or exceeds the upper limit of the public offering scale, all public investors who have submitted valid subscription applications will be eligible for the placement on a pro rata basis. At the same time, the public The fundraising period for the sale part will end early.
That is to say, if the public investor raises a scale of 1 billion yuan, but there is a subscription scale of 10 billion yuan on the first day of the fundraising period, each investor can buy 1/10 of its subscription scale. This is significantly different from the “lottery lottery” system adopted for online subscription of new shares.
5. How to sell?
Infrastructure public offering REITs operate in a closed manner, with a long closed period and no subscription and redemption business during the closed period. However, they will be listed and traded during the closed period. After listing, investors can conduct investment transactions through the stock exchange.
After an infrastructure fund is listed, investors can directly participate in on-exchange transactions using the fund shares subscribed by the on-market securities account; the fund shares subscribed by the off-exchange fund account should first be transferred to an on-market securities business institution before they can participate Trading on the floor.
6. What are the risks?
1. Price fluctuation risk; 2. Project operation risk; 3. Liquidity risk; 4. Termination risk; 5. Tax and other policy adjustment risks.
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Editor in charge: Yang Hongbu
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