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What is IPO? Why will it affect A shares?
Initial public offering (IPO): refers to the first time that an enterprise or company (joint stock limited company) sells its shares to the public (IPO refers to the way that a joint stock company makes an initial public offering to the public).

Usually, the shares of listed companies are sold through brokers or market makers according to the terms agreed in the prospectus or registration statement issued by the corresponding stock exchange. Generally speaking, once the initial public listing is completed, the company can apply for listing on the stock exchange or quotation system. A limited liability company shall be changed into a joint stock limited company before applying for initial public offering.

Another feasible method of listing on the stock exchange or quotation system is to stipulate in the prospectus or registration statement that private companies are allowed to sell their shares to the public. These stocks are considered to be "freely traded", which makes enterprises meet the requirements of listing on the stock exchange or quotation system. Most stock exchanges or quotation systems have rigid regulations on the number of shareholders of listed companies, which stipulate the minimum number of freely traded shares.

IPO has four major impacts on the stock market.

First, it strengthens the financing color of the stock market. Although the stock market that can't achieve financing is not a sound market, the market that has paid too much attention to financing for a long time should be treated differently. According to statistics, in recent 10 years, the A-share market financing was 1.76 times cash dividend. Although the amount of IPO financing in the market has declined in the past two years, the phenomenon of refinancing continues to heat up. The refinancing balance in the first ten months reached 2.8 1 times of the IPO amount. About 46 listed companies have issued refinancing plans. It is estimated that blood draw will reach 654.38+0073 billion yuan. It is worth mentioning that the market has picked up slightly, and some large refinancing companies have started to circle money again. For example, on the 27th of this month, China Ping An (60 13 18) passed the approval of the convertible bond issuance plan with a capital of no more than 26 billion yuan. Some time ago, 20 billion convertible bonds issued by Minsheng Bank (6000 16) were also approved. In the face of such a low dividend yield market, financing phenomenon appears frequently. Where is the attraction of A shares? If the IPO is restarted, it will only push the financing phenomenon of A shares to a new climax.

Second, it has hit investors' investment confidence. The stock market must fall! With the introduction of negative policies, the confidence of shareholders in holding shares will also decline.

Third, it distorts the essence of value investment. The resumption of IPO will inevitably involve many problems, such as the "three highs" phenomenon of stocks, the fraudulent behavior of some enterprises trying to go public and so on. Suppose that the PE value of a company before listing is about 15 times, and its net profit will increase by 30% in the next three years. In other words, investors hold PE for a long time at around 15 times, and can still get a good rate of return in the future. However, after the stock was listed, it was heated up, and the PE value soared to 50 times, which seriously overdrawn the growth expectation of the company. At this time, investors choose to buy and hold for a long time, and the probability of loss is quite large. Therefore, in the case of lax supervision, IPO restart also distorts the essence of value investment to some extent.

Fourth, it has contributed to key issues such as interest transfer. Talking about this, we can easily think of the four auxiliary institutions of IPO, namely, securities companies, law firms, accounting firms and IPO consulting institutions. From the perspective of subdivision, securities companies are mainly responsible for underwriting securities issuance, checking public offering documents and issuing recommendations; Law firms mainly issue legal opinions on legal issues related to issuance and listing; Accounting firms mainly give professional advice on corporate finance and profit expectations; IPO consulting agencies provide services for corporate financing services, the introduction of strategic investors and other related matters. Take the institution responsible for underwriting securities issuance as an example. Underwriting fees are the main interests that institutions strive for. In other words, the higher the underwriting fee, the greater the income the institution obtains. According to the data, the underwriting cost of the main board and small and medium-sized board market is about 5%, while the underwriting cost of the IPO of GEM companies is about 3% of the total fundraising. If the institution realizes the phenomenon of over-offering in some way, the underwriting fee obtained by the institution will increase accordingly, and the benefit transfer will also occur. In addition, the phenomenon of "rent-seeking" in the stock market has also led to the gradual deterioration of the above problems. There is even a phenomenon, for example, some enterprises do not meet the listing conditions, but succeed in IPO through some unknown means, and finally achieve the purpose of circling money.