Xinhua News Agency, Beijing, April 10th Topic: The reform of the registration system for the first batch of companies listed on the Shanghai and Shenzhen main boards to issue shares has been fully implemented
Xinhua News Agency “Xinhua Viewpoint” reporter
On April 10, the first batch of 10 companies listed on the main board registration system of the Shanghai and Shenzhen Stock Exchanges. Since then, the reform of the stock issuance registration system has been fully implemented, providing more solid institutional support for accelerating the construction of a standardized, transparent, open, dynamic and resilient capital market.
The first batch of companies listed on the Shanghai and Shenzhen main board registration system
On April 10, the listing ceremony of the first batch of companies under the main board registration system of the Shanghai and Shenzhen Stock Exchanges was held to welcome the “appearance” of the first batch of companies under the main board registration system.
On February 17, the China Securities Regulatory Commission and the Shanghai and Shenzhen Stock Exchanges announced the implementation of the comprehensive registration system reform system rules, and the registration system was extended to the entire market and various public offerings of stocks. After the Science and Technology Innovation Board, the Growth Enterprise Market, and the Beijing Stock Exchange have previously piloted the registration system, when the Shanghai and Shenzhen main boards will usher in the first batch of companies under the registration system has become a hot spot in the market.
Judging from the progress of the listing review of the first batch of companies, with the formal implementation of the comprehensive registration system, the exchange has assumed the main responsibility for the issuance and listing review. The IPO projects of the first batch of 10 companies were transferred to the stock exchange for review. After the review was passed, they were approved by the China Securities Regulatory Commission for registration approval, and then completed the issuance, meeting the listing conditions.
Zhou Jiguo, chairman of CLP Port, which is listed on the main board of the Shenzhen Stock Exchange, said: “After the company submitted the translation application materials, the exchange completed the acceptance on the same day, arranged a meeting on March 13, and obtained the registration approval from the China Securities Regulatory Commission on March 16.”
It is understood that 5 of the first batch of 10 companies landed on the main board of the Shanghai Stock Exchange, namely Zhongzhong Science and Technology, CITIC Metal, Changqing Technology, Jiangyan Group, and Pakson, with a total initial fundraising of 16.241 billion yuan; The main board of the Shenzhen Stock Exchange is Dengkang Dental, China Power Port, Haisen Pharmaceutical, Shaanxi Energy, and Nankuang Group, with a total initial fundraising of 11.888 billion yuan.
Statistics from CICC show that in 2022, the average net profit attributable to the parent of the 10 companies will be 660 million yuan, and the growth rate of net profit attributable to the parent and the average return on equity will be 82.3% and 21.7% respectively.
From the Science and Technology Innovation Board to the Growth Enterprise Market, the Beijing Stock Exchange, and then to the entire market, from the incremental market to the stock market, the registration system has embarked on a road of gradual reform. Yi Huiman, chairman of the China Securities Regulatory Commission, said: “The holding of the listing ceremony marks the full implementation of the reform of the stock issuance registration system, which is another important milestone in the reform and development of China’s capital market.”
Improve audit quality and efficiency, insist on opening the door for audit
In the reform of the registration system, the stock issuance review system has undergone a major transformation from the approval system to the registration system. “Under the comprehensive registration system, the audit subject is transferred to the stock exchange, and the China Securities Regulatory Commission is responsible for performing the registration procedures and supervising the audit work of the exchange. The division of authority between the China Securities Regulatory Commission and the exchange is further clarified.” Member of the Investment Banking Management Committee of China Securities Jet Liu said.
On February 17, 165 system rules related to the comprehensive registration system were issued and implemented. “Under the registration system, the review department has promulgated a series of review guidelines such as guidelines for the application of regulatory rules, clarifying the key issues in the review process, the verification requirements of intermediary agencies, and regulatory measures. The exchange review also focuses on the aforementioned review guidelines. It improves the standardization and transparency of the review process.” said Li Bangxin, executive general manager of CICC’s Investment Banking Department.
A number of the first batch of listed companies expressed in interviews with reporters that they deeply felt the many changes in the review and listing process of the issuance: the regulations and guidelines under the registration system are more concise and clear, and the questions asked by the exchange are more streamlined and focused; Under the registration system, the main application documents, problems and results of the meeting are disclosed, which improves the transparency of the review.
“The reform of the comprehensive registration system adheres to the principle of marketization, and adjusts and optimizes the mechanism arrangements such as pricing and placement. While successfully completing market-oriented pricing, it also enables investors to gain a deeper understanding of the company.” Director of Zhongzhong Technology, which was listed on the main board of the Shanghai Stock Exchange Chang Ma Bingbing said.
The China Securities Regulatory Commission stated that the reform of the registration system is a change that touches the underlying logic of supervision. Under the comprehensive registration system, we must persist in conducting audits with the door open and accept social supervision.
The reporter learned that the two major exchanges have recently launched relevant measures, and the Shanghai Stock Exchange has issued an action plan to further promote “open-door review, open-door supervision, and open-door service”. The Shenzhen Stock Exchange has carried out a special campaign of “Three Sunshines and Two Promotions”, focusing on stock issuance review, supervision, and services under the registration system to create a transparent, clean and efficient registration system.
As one of the basic systems of the capital market, the trading system is an important link in the comprehensive implementation of the registration system reform. With the listing of the first batch of new shares under the registration system, the new trading system on the main board has also been implemented.
“This reform follows the basic ideas of improving pricing efficiency, enhancing market stability, and facilitating investors to participate in transactions, copying and promoting some trading systems on the Science and Technology Innovation Board and ChiNext to the main board, and optimizing and improving the main board trading system.” Everbright Securities Gao Ruidong, chief macroeconomist, said.
Experts reminded that under the new trading system, there is no price limit for the five trading days before the listing of new shares, and there are also changes in the intraday temporary suspension system, etc. Investors should fully understand this.
Strengthen the quality of information disclosure and “zero tolerance” for fraudulent issuance
The registration system converts the issuance conditions under the approval system into information disclosure requirements as much as possible, which means that the core role of information disclosure is further strengthened. People in the industry believe that while improving the tolerance of the capital market, it is necessary to effectively control the quality of information disclosure and tighten the responsibilities of issuers and intermediaries.
Jin Licheng, vice president of the Investment Banking Division of Guotai Junan Securities, said that as the sponsor and lead underwriter of the IPO of Zhongzhong Technology, he deeply felt during the reform of the registration system on the main board that the reform of the comprehensive registration system requires “responsibility upon declaration” , Urge all market players to return to their positions and fulfill their duties, and strictly control the quality of listed companies.
Haisen Pharmaceutical is listed on the main board of the Shenzhen Stock Exchange this time. The general manager of the company, Ai Lin, said that during the whole listing process, he really felt the obligations and responsibilities of the company as the main body of information disclosure. “The registration system’s high standards for information disclosure have in turn promoted the company’s daily management work to be more standardized, systematic and orderly.”
“Under the comprehensive registration system, the quality of information disclosure and the quality of investment banking practice have been raised to unprecedented heights. Investment banks should further enhance their own value identification and value discovery capabilities, and build a bridge for high-quality companies and investors.” CITIC Securities Investment Banking Director Xu Feng said.
The essence of the registration system reform is to hand over the right of choice to the market, strengthen market constraints and legal constraints, and improve the convenience of investment and financing. Compared with the approval system, the implementation of the registration system not only involves changes in the review subject, but also involves changes in concepts, gatekeeping methods, transparency, and regulatory enforcement.
Yi Huiman said at the listing ceremony that under the registration system, information disclosure must be the core, and the regulatory authorities will not make judgments on the investment value of companies. They will mainly check the quality of information disclosure through inquiries, and put the issuer’s information disclosure first. Responsibility, intermediary agency “gatekeeper” responsibility. Open the door to conduct audits, and the standards, procedures, inquiry content, process, and results of the audit registration are all disclosed, and the supervision and checks and balances are stricter, so that public power can operate in the sun. There is “zero tolerance” for various violations of laws and regulations, such as fraudulent issuance, financial fraud, etc., and they will be punished immediately, and administrative, civil, and criminal penalties will be imposed to form a strong deterrent. (Reporters Yao Junfang, Liu Yujia, Pan Qing, Wei Weihua)