On the evening of February 21st, CCTV Financial Channel “Global Finance Connection” focused on China’s re-opening of China’s concept stocks in the United States in January this year.
The host Mr. Ruan Chenggang pointed out: After experiencing the so-called “freezing period” of overseas listings for half a year, China's Internet industry has once again emerged as the so-called crab-eaters of the US IPO, “Shenzhou Car Rental”, “VIP”, “Easy Media”. "3 Internet companies. Recently, the three companies submitted their prospectuses to the US Securities and Exchange Commission, which opened the prelude to the overseas listing of Chinese Internet companies in 2012.
On February 17th, Shanghai-based Internet advertising service provider Yiyi Media submitted an IPO application to the U.S. Securities and Exchange Commission and planned to raise 100 million U.S. dollars on the Nasdaq; the same day, the brand discount e-commerce company "VIP will" The IPO application documents were submitted to the United States Securities and Exchange Commission, and they are planned to be listed on the NYSE with a plan to raise up to 125 million U.S. dollars. Prior to this, China's largest car rental company, "Shenzhou Car Rental," submitted a listing application to the US Securities and Exchange Commission on January 18. The company plans to list on the New York Stock Exchange, raising approximately US$300 million in funds. This is also the first Chinese company to submit an application to the US Securities Regulatory Commission after the US Securities Regulatory Commission revised the rules for submission to December 2011. Due to the quiet period before the listing, the three companies did not accept interviews with CCTV reporters. However, the reporter learned from the prospectuses of the three companies that although the Chinese concept stocks were shorted last year, these three companies are still optimistic about the United States. The IPO, however, there are still a lot of variables for the successful listing of the three companies. Taking the application documents provided by China Shenhua Car Rental as an example, as of December 2011, Shenzhou Car Rental has more than 500 car rental outlets in 66 cities in China, with a fleet size of approximately 26,000 vehicles, which is 4 times that of the second place in the industry. However, in the first nine months of 2009, 2010 and 2011, the company’s net losses were RMB 3.2 million, RMB 43.3 million and RMB 117.6 million, respectively. Although Car Rental Co., Ltd. hopes to become the first player in the Chinese car rental industry, its road to listing is full of thorns.
Rui Chenggang pointed out that China’s concept stocks have always been highly sought after by the US capital market and US investors because of the so-called “China concept”. Since last year, China’s concept stocks have suffered repeated setbacks. Not only has the stock price plummeted, there are more than 10 stocks. The company suffered a suspension or was delisted.
In response, Reuters commentator Chen Yijia believes:
In fact, in addition to the three companies just mentioned, there is news that Jingdong Mall also plans to submit a listing application in March, listed on the Nasdaq. It should be said that after the Chinese company has been quiet for some time in the US market, there is still a lot of expectation in the market. Everyone in China concept stocks knows that in 2011, due to the short-selling wind, the stock price has been affected by the apparent decline. However, after entering 2012, a lot of data appeared on China concept stocks. For example, the share price of a series of companies such as Renren, which was listed last year, apparently rebounded, and overall performance was better than that of the US stock market. It can be seen that investors’ confidence in China’s concept stocks has begun to slowly recover. In addition, companies that had previously been short-selling like fish in troubled waters also started to suggest buying Chinese concept stocks.
From the perspective of their operations, several companies that will be listed are working with investment banks that are big and internationally influential, such as Goldman Sachs and Morgan Stanley. Compared with some listed companies before the audit work, it is more strict and transparent. The U.S. investors are not focusing on the "China concept" for Chinese companies. Instead, they focus on specific factors such as the size of the company itself, the profit model, and the structure of the shareholders. At the same time, they attach more importance to the linkage between consumption and the Internet. Linked to some companies. From the point of view of these companies, communication with investors is even more close, and some of the information in these areas is also moving toward more concrete and transparent directions.
Of course, it is hard to expect several companies to immediately launch listings after they apply for a listing. As many companies and investors who want to go public will still have a wait-and-see attitude, but these companies will be listed. After the performance, it will be a very important market signal, determine the future trend.
(In addition to the U.S. market), FaceBook's listing has indeed attracted the attention of the entire investment community, and indeed many people are talking about their valuations every day. However, many of their analysts said that their company's listing is not an indicator of the industry, because their companies are different from many technology companies in terms of profitability and their growth. However, it is still clear that technology companies are still the darling of the market. It can be seen from last year that many large companies such as Zynga and LinkedIn have received great attention after their listing. Of the five major technology listings in the United States, four major ones occurred last year. After entering 2012, among the 18 listed cases that have taken place, the number of tech companies is still the largest, with a total of six, such as Brightcove and some of these network-related service providers. After their listing, according to data released by relevant agencies, the overall rate of return has reached 25.2%. But the problem is that the amount of cases listed this year is relatively small, and the performance on the day of listing has a decline of more than 5%. At present, the entire market is relatively optimistic for technology companies. On the one hand, it is because there are some big listings such as FaceBook. It is worth looking forward to. On the other hand, because of the stock of technology companies, it has been performing well recently. For many funds, they use technology as their most important direction in investing in stocks. However, the total US market is still very weak. From last year's point of view, it has fallen by 29% compared with 2010. In the first 2 months of this year, it has fallen further by 25% compared with last year. Moreover, the amount of financing for listing fell by nearly 80% compared with the same period of last year. So, in general, the listing market is still relatively modest.
Hu Yanping, an expert at DCCI Internet Data Research Center, believes:
The credit crisis may not have passed, but the recovery of Chinese concept stocks, especially the listing of Internet concept stocks, began. In fact, the root cause of the problem last year was mainly the global financial environment and the second bottom of the financial crisis. The second reason is that China's network concept stocks are at the level of integrity. There were 11 concept stocks listed last year. However, there are also delistings, and the delisting amount may be a little more than the amount of financing listed. So last year's market appeared to be mass market, but the overall situation was not very good. But in fact, the fundamentals of the Chinese Internet are never bad. Furthermore, it may be the best time for development in 2011 and 2012 when we look at fundamentals. Because of the related investment figures, the number of investment projects last year and the increase in the amount of investment in the venture capital market were more than 100% and 360% compared with 2010, in addition to listings and early angel investments. Such a significant increase indicates that people are still very optimistic about this market from the perspective of capital. As for the part invested by angels, it is more active. There is a saying in the industry that "angels fly everywhere." Especially in mobile Internet, there have even been more cases of investment than projects. So in terms of fundamentals, the Chinese Internet has never been worse. The growth of the video field last year was 100%, so the growth like search is 70-80%, etc. The fundamentals of each market are very good, including users. Now it is 988 million mobile phone users, more than 500 million internet users, and trillions of industries. This industry is not a bubble, and it will not be affected by short-term factors in the capital market.
The Chinese concept stocks will undoubtedly reaccelerate in 2012. If Facebook's listing is a resurgence of global technology stocks, the submission of these three Chinese concept stocks is a sign of a resurgence in the return of Chinese stocks. And from the situation in 2011, the situation of mass market may reappear. Because there were 11 companies last year, according to our understanding this year, there are more than 20 queues waiting to be listed. More than 10 households in this more than 20 home should have the opportunity to formally land on the capital market. Each household has more than 10 households out of more than 10 households in terms of scale, revenue capacity and potential development capacity. Before the year, the quality of the first batch of Internet listed companies in China was better.
In the short term, frankly speaking, in the field of China's Internet, it is very unlikely that there will be opportunities for world-class and leader-level companies, especially for the moment of listing, he is a global platform. So from the capital market, we are still very optimistic about this area. Capital is also a very good help. To catalyze the means in this field, biotechnology, new energy, the Internet, and investors are three very important choices. From our judgment, this year's e-commerce, social entertainment, media marketing data These three areas will become the three areas sought after by the capital market.
Background information: At the beginning of last year, Renren landed on the US capital market with a 440-pound earnings ratio, with a market value of US$7.482 billion, and became the second largest Chinese company. Until mid-June last year, its share price has fallen by half. In the second week of June, China’s stock index plunged 15.39% for a single week. Not only that, the Youku, a Chinese video company that landed on US stocks last year, had a 161.25% daily rise, and after this year, the stock price was also less than 30 US dollars, which is less than half of the highest point. On the first day of listing, Dangdang.com, which had gained as much as 87%, once fell below the issue price of $16 in early June. As the leading stocks of Sina, the stock price surged to 150 US dollars in mid-April, and dropped to 80 US dollars in June. With the drop in stock prices, since last March, Chinese concept stocks have continued to spread negative news about financial fraud and illegal operations. Integrity crisis has not dissipated yet, and the rating agency Standard & Poor's has lowered the US sovereign credit rating. In just three months, Chinese concept stocks tasted “no minimum, only lower”. Shanda Networks, Cool Media, and 11 other stocks fell by 6% to 10%. After September 2010, companies listed in the US almost all ended in plunging. According to statistics, 24 auditors of Chinese listed companies in the United States have resigned or exposed the financial problems of the audited objects. 19 U.S. listed companies are suspended or delisted
