Overseas Chinese companies are often short to improve corporate governance as a solution

Today, the market performance of Chinese companies abroad may be described in a hopeless way, at least from their present performance, more like standing in front of Noah's Ark, without a ticket.

After a number of reduction in the size of the financing and by the original investors to subscribe for some shares, only goods will be listed on the NYSE. However, the desperate trend of the contrarian listing, it does not give a good example to the long-awaited successor: the undervaluation of IPOs, the lack of subscriptions, and falling share prices after the IPO show that they have not really gained the recognition of investors – behind the continuing slump in confidence in Chinese concept stocks by overseas investors. Clearly, investors on the shares of the many scruples and concerns remain, the short term to the U.S. listing tide will become Nankeyimeng.

It is understood that after the outbreak of the financial crisis, the international economic map from Europe and the United States to China as the representative of the developing countries to transfer, the domestic RMB funds to raise, investment is replacing the original active foreign investment into the mainstream. However, this is a sharp contrast with Chinese companies being shorted and the slump in Chinese companies ' listing abroad.

"On sale."

"The continued growth of China's market has brought about dividend opportunities for Chinese enterprises, but it is easy for enterprises to have a certain superiority, once the enterprise with this idea to live, in the real market crisis, it is easy to ' discount '." "Martin Haemmig, a visiting professor of venture capital and entrepreneurship at the Federal National Defense University, Leiden University Technology and Innovation Management Center, said Martin Hamming, the first financial journal.

Martin Hamming Analysis said that investment banks and VC/PE in the proposed enterprise listing, often the enterprise has overvalued, but the current market is not to pay for high valuations, on the contrary it will automatically adjust to its reasonable value, which led to the enterprise break, listed low valuations. "This is actually a punishment for their early expectations." "he said.

According to the information provided by the Chingko Research Centre, the continued impact of the slow recovery of the world economy and the frozen period of the first half of 2011, combined with the early years of the year in January 2012, and the number of overseas listings of Chinese enterprises and the amount of financing in the second quarter of 2012 were significantly lower than the four 11 Chinese companies in two overseas markets only raised 547 million U.S. dollars, the number of listed on the chain reduction of 8, financing volume decreased by 77.8%, year-on-year, the number of Chinese enterprises overseas listing and financing volume also significantly reduced, which only the amount of financing than the same period in 2011 shrank by nearly 60%.

"Chinese companies, when considering a listing, are best able to combine their business with the target consumer, the area where market investors are located, rather than leaving these factors alone to go overseas." Martin Hamming pointed out, "if some of the business itself in the domestic enterprises rushed overseas listing, it is easy to be not understand the situation of overseas analysts ' suppression '. Once overseas capital markets are weak, the first to fall will be Chinese companies. ”

"Be taken."

And on the other side of the exchange, the low tide erupted, the mainland companies listed in Hong Kong are facing the most concentrated in the history of a stock price dive. Year old Bao (00312.HK) to "provide some other information" to the auditor and delay the publication of the performance; Holt Health (06880.HK) The share price plummeted due to a full-year profit of only about 30% per cent of the prospectus, Dr Frog (01698.HK), Daqing Dairy (01007.HK) is one after another because the auditor farewell set off a private enterprise credibility crisis climax. And in the last year with Dr Frog, Daqing dairy industry has the same fate of China's forests (00930.HK), Ruijin Mining (00246.HK), star paper (03868.HK) Three private enterprises shares have not yet been a duplicate license to the future.

In view of the Chinese enterprises listed financial integrity issues frequently exposed, Martin Hamming told reporters, once the economic difficulties, Chinese enterprises for a long time the problem of corporate governance was exposed. "Chinese companies often have 35 collector before they go public, but few respect the" rules "of listing abroad, such as transparent disclosure of information and clean financial statements. "Martin Hamming bluntly, the repeated occurrence of financial cheating is undoubtedly tantamount to hurting the hearts of overseas investors again and again."

Charlie, the head of start-up business, also told reporters that the governance behind Chinese enterprises is actually a matter of corporate culture, and this culture needs to accumulate for a long time, not before the listing by surprise can be improved. In his view, VC/PE is currently moving the investment phase to the early stage, which is behind the increase in industry competition and the reasonable return of enterprise valuation factors, in fact, this is VC/PE attempts to intervene in the initial enterprise culture to correct the corporate cultural governance of a practice. "I believe that after 5-8 years, China's entrepreneurial environment will be changed, it will breed a truly successful listed companies." ”

The Chinese companies listed overseas may not be aware of this, and they are anxiously looking for a ticket for Noah's Ark, and the ticket is in the hands of the enterprise-it is not just the enterprise itself, but the entire ecosystem.