| Since the establishment of China’s stock market,China’s stock issuance system has undergone a change from an administrative approval system to an approval system.In particular,the STAR Market or the Science and Technology Innovation Board established in 2018 broke the previous practice of government approval for listing and implemented a registration system.The implementation of the registration system means that China’s stock issuance focuses on a greater orientation to the market and to fairness,which can greatly improve the efficiency of listing.The Science and Technology Innovation Board is different from the Main Board in terms of stock issuance and pricing methods,listing standards and listing review methods,and it shows greater flexibility and inclusiveness compared with the latter.Therefore,it quickly becomes an important financing platform preferred by those small and medium-sized enterprises,start-ups,and high-tech companies intended to go public.While the greater inclusiveness and market-oriented reforms infuse energy into the STAR Market,they also have some side effects.For example,higher investment and market risks caused by the uneven qualifications of companies to be listed,and the similar or even equal prices offered by institutional investors for a certain new stock obviously undervalued among the companies that came on the Market between 2020 and 2021（The huddling-to-lower-the-prices of institutional investors）.Although these may not be entirely caused by the system of the Market,its looser listing system and pricing method may provide institutional investors with an opportunity to conspire.Since 2005,China has implemented the IPO inquiry system,which is determined by the institutional investors who participate in the inquiry and offline IPO through bidding.But online investors are just the recipients of the ipo price.The essence of this system is like an auction,and the ipo price is determined by institutional investors through price game.At present,in response to the high underpricing and the huddling-to-lower-the-prices of institutional investors under the registration and IPO inquiry system,scholars attribute them to the information asymmetry between the primary market and the secondary market.Few,however,have studied the reason for the underpricing of a newly issued stock in the primary market.Besides,regarding the huddling behavior of institutional investors,most of the existing literature studies it when investors make decisions as shareholders after the stock is listed.There is little research on it at the pricing of a new stock.Therefore,by studying the "consistent quotation"of institutional investors which is highly concentrated in the pricing of a new stock,thi’s paper explores the reasons why the initial price of a new stock is undervalued from the perspective of institutional investors,as well as the motive and consequences of convergent quotation,an abnormal market behavior.It is hoped that on the basis of digging out the causes and consequences of the incident,I can put forward opinions and suggestions for the improvement of China’s listing system and inquiry policy.Therefore,intentional price reduction and huddling pricing can be suppressed at the institutional level in the future,leading to the stable operation and development of China’s securities market.This paper adopts the single-case study method,and selects Swancor Advanced Materials Technology Co.,Ltd.（shortened to Swancor Advanced Materials）as the case study object.Swancor New Materials came on the STAR Market in 2020 with an initial price of 2.49 yuan per share,a record low for the IPO price of the Market at that time;and during the IPO inquiry process,up to 96%of institutional investors are unanimous in their price quotation at 2.49 yuan.This paper explores the causes of the same low price of Swancor Advanced Materials according to the situation of the company before listing,the IPO quotation of the STAR Market and the asset evaluation agency,and analyzes its impact from the perspective of the company and the market,through the case study of the company underpriced by the huddling institutional investors in the price inquiry process,with a combination of previous studies on price inquiry mechanism and IPO underpricing.On this basis,some suggestions are put forward to improve the pricing and inquiry system of sci-tech innovation board,standardize the quotation behavior of institutional investors and promote the supervision of securities market.Through research,this paper finds that institutional investors have the following motives for huddling together to lower the prices:First,the exclusion rule of high prices in the IPO inquiry system makes institutional investors dare not offer high pricing,while the same pricing of the huddling investors can reduce their risk of being excluded;second,the reform of the registration system has changed the supply and demand relationship in the IPO market.Given that the supply of new stocks continues to rise,investors’enthusiasm for those stocks will inevitably decline,and their quotations will also tend to decrease.Third.the asset appraisal institutions is not professional,which will cause some investors of small institutions with insufficient self-assessment capabilities to follow the pricing of large institutions.Fourth,the policy environment faced by the industry to which the enterprise belongs leads to the poor financial status and future operating results of the enterprise,and it is difficult for investors to bid a high price.The direct result of this is that it becomes difficult for listed companies to meet the raising requirements,and the IPO underpricing rate increases.Furthermore,the inconsistent price of the newly issued stocks with its value will lead to speculation in stocks,resulting in high volatility in stock prices,which is unfavorable for the further development of the securities market and is contrary to the original intention of the market-oriented IPOs.Starting from exploring their motives,this thesis focuses on institutional investors’ huddling behavior to lower the prices,and puts forward specific suggestions of policy to prevent inquiry institutions from this behavior.Suggestions are as follows:First,the regulatory authorities can introduce multi-channel supervision means such as news media,investment agencies and external audit institutions,and increase the punishment of illegal inquiry;Second,it is feasible to for Securities Association of China to improve the objectivity of the issuer’s investment value study report by canceling the requirement to provide the report for the lead underwriter and encourage other participants in the market to publish their reports of the new stocks.Third,institutional investors should improve professional research ability,optimize internal control,prevent the disclosure of quotation information undertake the market responsibility given by the inquiry system;Fourthly,listed enterprises should pay attention to external environmental risks.As technological innovation enterprises,they should pay attention to r＆d investment and expand market scale,so as to improve their growth ability.The theoretical significance of this paper is as follows:First,by studying the motivation of institutional investors to cluster in IPO inquiry stage,this paper can enrich the perspective of institutional investors cluster research and provide reference for the theoretical expansion.Second,combined with IPO underpricing theory.explore the cause of IPO underpricing at the quotation stage,to provide a new direction for the study of IPO underpricing theory.The practical enlightenment of this paper lies in that,on the basis of digging out the causes and consequences of the event,relevant suggestions are put forward for the improvement of China’s listing system,inquiry policy and the regulation of market participants’behaviors,so as to promote the rational allocation of market resources and ensure the stable and healthy development of the capital market. |
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