Guotai Haitong: Hong Kong IPO remains active, benefitting cross-border investment banking business.

Guotai Haitong published a research report stating that in March, there were 15 A-share companies that went public, an increase of 7 compared to the previous month, raising a total of 14 billion yuan. The scale of Hong Kong IPOs from the beginning of the year to now is 109.9 billion Hong Kong dollars, an increase of 489% year-on-year, with 17.5 billion Hong Kong dollars raised in March. On the margin, the pace of A-share equity financing has shown some improvement, Hong Kong stocks remain active and significantly boost, leading securities firms with advantages in corporate customer resources, professional service capabilities, and cross-border service capabilities are expected to continue to maintain a leading position in the evolution of investment banking business ecology. Guotai Haitong's main points are as follows: A-share: Equity financing continues to rebound 1) IPO: According to issuance date statistics, in March, there were 15 A-share companies that went public, raising a total of 14 billion yuan; 2) Secondary offering: According to issuance date statistics, the secondary offering scale in March was 83.2 billion yuan. The IPO scale of A-shares from the beginning of the year to now increased by 80% year-on-year, and the secondary offering scale increased by 112% year-on-year, continuing to improve; 3) Mergers and acquisitions: There have been a total of 28 major restructuring events by listed companies disclosed since the beginning of the year, with 8 in March; 4) Bond issuance: The underwriting scale has increased compared to the previous year, and the total issuance scale of core bonds (corporate bonds + enterprise bonds + convertible bonds) in March was 543.2 billion yuan, with a cumulative year-on-year growth rate of +25% since the beginning of the year. Hong Kong stocks: IPO continues to grow, while secondary offering declines year-on-year Since the second half of 2014, the trading activity of Hong Kong stocks has significantly increased, with market liquidity improvement driving a significant increase in Hong Kong IPOs and secondary offerings. The scale of Hong Kong IPOs from the beginning of the year to now is 109.9 billion Hong Kong dollars, an increase of 489% year-on-year, with 17.5 billion Hong Kong dollars raised in March; the secondary offering scale is 5.9 billion Hong Kong dollars, a decline of 72% year-on-year, with 5.9 billion Hong Kong dollars raised in March. Charles Li, CEO of the Hong Kong Stock Exchange, stated that the direction of mainland regulatory agencies' support for companies listing in Hong Kong has not changed, and the Hong Kong Stock Exchange will work together with mainland exchanges to provide financing support for the development of mainland companies and help them go global as part of the country's high-level opening-up strategy. It is expected that Hong Kong stock financing will continue to be active. In a new stage of investment and financing rebalancing, reform dividends continue to be released, benefiting securities investment banking and other businesses On March 6, Chairman Wu Qing answered questions at the National People's Congress Economic Theme Press Conference of the 14th National Committee, stating that there will be two new measures introduced in the near future. One is to deepen the reform of the Growth Enterprise Market, including key measures such as setting more precise and inclusive listing standards to support the development of new industries, new formats, and new technology companies. The second is to optimize the secondary offering mechanism, further improving the secondary offering review and registration mechanism at the institutional level, such as introducing shelf offerings to increase convenience. Risk warning: Capital market fluctuations; tightening of IPO pace.