On April 8, Shenzhen Stock Exchange released the listing rules of ChiNext Market which would gather excellent enterprises only, pushing forward the ChiNext Market with all excellent enterprises one more step. Insider predicted that in the second quarter, the supportive policies for ChiNext Market with all excellent enterprises would be issued successively, including issues like investment threshold would be made clear. In addition, in the second quarter, reform on issuance system was also worth expecting. This would undoubtedly have profound influence on the development and reform of China's capital market.
Supportive Policies for ChiNext Market with All Excellent Enterprises Were Actively Promoted
The release and implementation of "Interim Measures for Administration over Initial Public Offering of Shares and Listing on ChiNext Market with All Excellent Enterprises" marked a substantial step for ChiNext Market with all excellent enterprises. The ChiNext Market which industry had expected for ten years entered countdown. List of excellent stocks.
Previously, many market people worried that the introduction of ChiNext Market with all excellent enterprises at this time would divert funds from the main board, affecting stock market stability. Regarding such concerns, many industry insiders believed that whether from macro confidence or micro substance, the current introduction of ChiNext Market with all excellent enterprises would not bring shock to market supply and demand aspects.
Announcing IPO methods for ChiNext Market with all excellent enterprises was only the first step; there were still many supporting rules needed to be introduced successively for officially introducing ChiNext Market with all excellent enterprises. Currently, CSRC and Shenzhen Stock Exchange were actively promoting related work according to pace and rhythm orderly.
Authoritative persons introduced that next step's supporting work of relevant departments mainly included establishing investor threshold, making explicit trading systems, etc. Currently, specific requirements for investor access were still under argumentation. The previous so-called 300 thousand yuan capital threshold was inaccurate.
Industry insiders analyzed that no matter how the final threshold was determined, investors could diversify their channels to invest in ChiNext Market with all excellent enterprises. Investors who met access system requirements could invest in ChiNext Market with all excellent enterprises by themselves; those who temporarily did not meet requirements could indirectly enter ChiNext Market with all excellent enterprises through funds or other ways.
New Issuance System Might Make Appearance
Reform on issuance system was the highlight of the development and reform of capital market. Authoritative persons expected that after more than half year preparation, new issuance system might announce plan in the second quarter, and solicit opinions from the society openly. Currently, regulatory department had three aspects of thoughts on stock issuance system reform:
Firstly, stock pricing should be further marketized. In the past improvements and perfection of issuance system, marketization mechanism had been established, such as inquiry system, sponsorship system, etc. These were important progress on marketization of issuance system, but such progress became insufficient with market development, needing further marketization reform on pricing mechanism. Further marketization of pricing would generate stricter restraint on these market entities, letting market entities truly take up responsibilities, forming the game among market entities.
Secondly, strengthening the restraint power of buyer side on seller side. The strength of buyer side's restraint power decided market operation quality. Buyers with strong restraint power would form strict restraint on issuers, making issuers more cautious. Strengthening buyer side's restraint power could also suppress some behaviors and phenomena in the market which people disliked.
Thirdly, balancing interests of all aspects under the situation of clear risk, especially the interests of small investors. Internationally speaking, there were many examples of new shares falling below issue price after listed. But overall speaking, new share issuance price would be lower than secondary market price. Willingness of China's small investors participating in primary market was very strong. Under the situation of clear risk, if small investors still had strong willingness to participate in issuance market, regulatory departments should value this willingness, taking into account the interests of all parties participating in new share issuance, especially the interests of small investors.
Profound Influence on Capital Market
The significance of launching ChiNext Market with all excellent enterprises and reforming issuance system for China's capital market was beyond doubt.
The opening of ChiNext Market with all excellent enterprises was an important measure to improve layers and structures of China's capital market, expand depth and breadth of capital market, could provide capital market services for numerous self-innovative and growth-type excellent entrepreneurial enterprises. It would also play exemplary and magnifying effects, pulling more private investments to promote upgrading of China's industrial structure, beneficial to alleviating employment difficulties. It was beneficial to better playing basic functions of capital markets in resource allocation, strengthening support of capital market to national economic development, promoting construction of innovative country.
New issuance system would make new share issuance pricing further trend toward marketization, avoiding dramatic fluctuations on the first day of company stock listing, and would protect the interests of small and medium-sized investors more.
Although any financial innovation meant risks, as long as prudently weighing, benefits were obviously greater than harm, it should seize opportunities to implement resolutely. ChiNext Market with all excellent enterprises was such a case, and new share issuance system reform was also such a case.