Medium-to-stock situation overseas investor attitude discounts

With the national day before the LAN-tech landing Nasdaq, 58 city and where to go to the SEC to submit a listing application, touch technology, Shanda literature, 3G portal, Sina Weibo and other enterprises brewing to the U.S. listing plan, a time in the stock seems to fire up, to the U.S. Listing window is open discussion also began lively.

However, all this for the early last year in the company for their investment in the U.S. listing process of the investment sector "veteran" Xu (alias), it is only a superficial lively. He told the first financial daily reporter, "in the United States has never been the so-called listing window open or close to say, North American investors will only discuss the current environment of the IPO, the changes in the market environment does not have a key impact on Chinese companies to the U.S. listing." "He bluntly said that the situation is not as good as expected, to reproduce two years ago, the possibility of Chinese companies to go to the U.S. listing is no longer possible."

Investors become smart

Xu admits that he has traveled to the United States frequently over the years, and that the important arrangement for a trip to the United States is to exchange views on Chinese companies with investors in North America. Xu bluntly told reporters that overseas investors at present to the Chinese companies to the U.S. market attitude has been a discount, taste has become increasingly picky, want to borrow the current situation and it is difficult.

Xu refers to the times from the second half of 2010 to the first half of 2011, Chinese companies have set off a small climax to the U.S. listing, at that time, including Mai-Lin, Dangdang, Qihoo 360, Century interconnection, Renren, NetQin, century Jiayuan, rice net and other enterprises have landed on the Nasdaq and NYSE, In that period of time there is no limit.

"At that time, there were a lot of companies, there are a large number of enterprises in order to circumvent the U.S. regulatory review through the backdoor way of listing, but after this lively and constantly burst of negative news to investors abroad on a lively case class." "Xu said.

The price behind the scenes is the collective indifference of the shares in the US capital markets after Waterloo and after that. "This is why only last year, only the goods will and the gathering time two of the stock successfully listed in the United States, and this year so far only three companies in the U.S. capital market foothold." "Xu said.

Clearly, American investors have become wiser by the bitter lessons of the past. At the same time, their understanding of the Chinese market has become more and more like the gradual expansion of the size of the stock.

"Investment power in the United States is mainly institutional investors, not individuals, who initially did not know much about Chinese companies, simply because they were bullish on the Chinese market and the Chinese concept, and that they had great growth potential." Today, more than 100 Chinese stocks in the North American capital market has long been not a small group, as these institutions to the Chinese market and enterprise understanding more and more comprehensive, China's enterprises want to enter this threshold must undergo a carefully selected process. Xu said, "just by telling a beautiful Chinese story is not enough to impress investors, they are also starting to penny-pinching, the road show will be very small, even miss any data." ”

He explained to reporters that North American investors generally do not estimate the listed companies according to the company's profits now, but to see the industry in the market space, the market is saturated, whether the enterprise because of the increase in income, profits will have an equal increase, once the hard indicators can not achieve the listed valuation will be discounted.

Don't deliberately make profits

According to Xu, for Chinese companies, it is now possible to maintain a yearly income of $60 million trillion, and maintain an annual growth of more than 50%, and if there is a profit, it will be more advantageous to open the door of U.S. capital markets. On the contrary, if the Chinese enterprises can not reach the requirements of the listed companies in the meager profit or loss, if its business model and performance is not convincing enough, want to accept the recognition of North American investors will be a certain degree of difficulty.

"It can be said that the threshold for Chinese companies to go to the U.S. market has been a big step, investors for the demand for stocks has become harsh." "Xu says this personal feeling is not only aimed at those listed Chinese companies looking to the overseas capital markets, but also includes some listed stocks. The only difference is that the former can have the right to choose another market, the latter once unable to adapt, only to leave the field. This year, from the U.S. capital market to withdraw the number of stocks far more than the listed enterprises, Technocon Biology, Siyuan Group, the media, public goods food, flying Crane International, seven days hotel and other Chinese enterprises have completed the privatization transactions, last year, the annual stock withdrawal of more than 30 enterprises.

The undervaluation of the enterprise is the explanation of the majority of the Xu in the market. He believes that the main reason for the withdrawal of the market is in fact the enterprise itself, is its subsequent profitability and growth space can not be recognized by North American investors, once the enterprise is not recognized by them, it will be eliminated by the capital market. "Globally, North American capital markets are highly mature and investors are active, and it will be difficult to go back to other markets once companies have retreated from mature capital markets," he said. ”

The only consolation is that there is a glimmer of light behind the gloom. In Xu's view, North America's economic recovery over the past year has hit record highs, and the revival of U.S. capital markets is a somewhat good sign. He believes that this good momentum will continue for some time, which will lead to investor confidence in the shares of the rally would have great benefits.

But he also sensed that some Chinese companies were deliberately making profits before they went to the US to make sure the cash flow before the IPO was positive. "This excessive overdraft performance is easy to be exposed after the listing of companies, as long as the performance of the listing after the big face will be easy to trigger the overseas market to the tightening of stocks." "For businesses, for now, it's going to be about sustained performance growth," Xu said. But now too many people still do not understand this truth, still blindly stare at the market to act, but the dividend of the stock era has long passed. ”