Strategic Emerging Board - a ray of light for the listing and financing of LED companies in 2016

In March 2016, the IPO registration system was implemented. The process of securities marketization has taken a further step, and the capital market has entered a new historical stage, and its status and role in the national economy has undergone major changes.

In March 2016, the IPO registration system was implemented. The process of securities marketization has taken a further step, and the capital market has entered a new historical stage, and its status and role in the national economy has undergone major changes.

“The only thing that can save a company is capital. If a company wants to survive, it must seek development through financing.” Li Cheng, deputy general manager of Nationstar Optoelectronics (002449.SZ), pointedly pointed out.

Guangsheng Company, the largest shareholder of Nationstar Optoelectronics, became the actual controller of Foshan Lighting (000541.SZ), the "Light King of China", at the end of this year. The attractiveness of listed companies is evident.

The implementation of the registration system will be more conducive to some powerful companies entering the capital market, and the phenomenon of lingering on IPOs such as Opple and Inventronics will also be alleviated.

The deeper significance is that some people believe that the implementation of the registration system will have a significant impact on the reconstruction of the overall market ecology, the reconstruction of stock values, and the reconstruction of investment concepts. The development of the LED industry is related to the national economy and people's livelihood. The overall market ecology is improving, the economic environment is improving, and corporate value is valued more than conceptual hype. As a physical manufacturing industry, LED will naturally receive better development assistance.

In May 2016, the tiered system of the New Third Board will be implemented. It will be roughly divided into three layers: innovation layer, cultivation layer, and basic layer. The innovation layer is the highest layer and has relatively high standards: 1. The average net profit in the past two years is required to be no less than 25 million, the return on net assets is no less than 10%, and the average number of shareholders in the past six months is no less than 200. 2. The compound growth rate of operating income in the past two years is not less than 40%, the average income is not less than 50 million yuan, and the total equity is not less than 30 million yuan; 3. The market value in the last 6 months is not less than 600 million yuan, the shareholder equity in the latest period is not less than 50 million yuan, and there are no less than 6 market makers. Overall, the standards are higher than the GEM listing standards.

It is understood that of the more than 5,000 companies currently listed on the New Third Board, about 500 meet the conditions.

Some people speculate that after layering, there will be bidding transactions and other trading methods that are more similar to the main board and GEM. There are many companies in the LED industry that have listed on the New Third Board, and the latest ones include Huapu Sunlife, Hangke Optoelectronics, Kuangtong Electronics, Hengxing Gaohong, etc. "I really don't have much expectations for financing," said the person in charge of a company that was listed on the New OTC Market last year. "It is mainly for the standardization and internal cohesion of the company. Of course, it also has great benefits in terms of bank loans."

The strategic emerging board is expected to have a breakthrough before July 2016. On December 23, Premier Li Keqiang presided over an executive meeting of the State Council, which decided to promote the establishment of the Shanghai Stock Exchange's strategic emerging board, increase the number of companies listed on the National Equities Exchange and Quotations, and study and launch a pilot program to transfer to the GEM.

The service objects of the strategic emerging board focus on "innovation" and "emerging", and are inextricably related to the LED industry. The strategic emerging board's proposal to "downplay listing standards will dilute profitability requirements and focus mainly on the company's sustainable profitability" is undoubtedly a ray of light for most LED companies currently struggling in the red sea of ​​low profits.

It is understood that the strategic emerging board has set up four sets of evaluation criteria: first, market value + cash flow + income; second, market value + income; third, market value + net profit; fourth, market value + shareholder equity + total assets. Market value is the core requirement for "listing". While expanding the path for LED companies to go public, it also puts forward higher requirements for the company's related operations and sustainable profitability.

In 2016, the impact and impact of capital on the LED industry will certainly not be small. With the help of capital, China's LED will also further influence the world.