ChiNext Continues to Empower Innovation-Driven Enterprises in three-year Registration-Based IPO Reform
GUANGZHOU, China, Aug. 28, 2023 /PRNewswire/ — On August 24th, the ChiNext board celebrated 3rd anniversary of registration-based IPO reform. The ChiNext board served as one of the main channels of equity financing for innovation-driven small and medium-sized enterprises whilst the registration system fostered market-oriented development and encouraged investor engagements.
Over the past three years, 500 companies, or nearly 40% of all ChiNext-listed companies, have been listed through the new IPO system with RMB 500 billion (USD 69.3 billion) capital raised, and the aggregate market capitalization surpassed RMB 3 trillion (USD 414 billion). Of these listed companies, more than 90% are recognized as high-tech companies, operating in fields including information technology, advanced equipment, and new materials.
As of August 23rd, 385 ChiNext-listed companies posted solid performance in semi-annual reports with total revenues of RMB 726 billion (USD 100 billion, +15% YoY) and total net profits of RMB 65.8 billion (USD 9.1 billion, +17% YoY), demonstrating their potential in driving economic growth. In particular, 74 companies delivered net profit growth of over 50% YoY. Investor sentiment remained upbeat, supported by Wind’s consensus estimate of over 30% yearly increase in the total net profits of the ChiNext index’s constituents.
Backed by strong fundamentals, the ChiNext index has gained the attention of investors during the market swing. There are 26 ETFs tracking ChiNext board, which have attracted RMB 32 billion (USD 4.4 billion) net inflows, as of August 23rd, and E Fund ChiNext ETF was at the top of the list with approximately 50% market share by AuM.
In recent years, the ChiNext board has accelerated its pace of cultivating the multi-tiered product system and E Fund Management (“E Fund”) took proactive actions to cope with the trend. In September 2022, the launch of ChiNext Board ETF Option with E Fund ChiNext Board ETF as the underlying security marked the debut of the first exchange-listed standardized derivative on the ChiNext board and illustrated its dedication to provide risk management instruments for investors. In July 2022, the inclusion of E Fund ChiNext ETF to the ETF connect program allowed foreign investors to invest in the ChiNext board.
While Mr. Pang Yaping, Head of Index Research Department at E Fund, believed that the ChiNext board could ride the tailwinds of the country’s economic growth, industry insiders expected massive, coordinated stimulation efforts from China Securities Regulatory Commission to restore investor confidence and create a supportive environment for ChiNext board.
About E Fund Management
Established in 2001, E Fund Management Co., Ltd. (“E Fund”) is a leading comprehensive fund manager in China with close to RMB 3 trillion (USD 414 billion) under management. It offers investment solutions to onshore and offshore clients, helping clients achieve long-term sustainable investment performances. E Fund’s clients include both individuals and institutions, ranging from central banks, sovereign wealth funds, social security funds, pension funds, insurance, and reinsurance companies, to corporates and banks. Long-term oriented, it has been focusing on the investment management business since inception and believes in the power of in-depth research and time in investing. It is a pioneer and leading practitioner in responsible investments in China and is widely recognized as one of the most trusted and outstanding Chinese asset managers.