The Research On China's Concept Stock Return

Due to the restriction of our regulatory policy,many Internet companies invested by overseas funds can not be listed in A-share market,so large Internet companies,including Tencent,Baidu and Alibaba,have to go overseas to finance their listing.Because its main business place is in mainland China,it is also called “Chinese concept stocks ”,abbreviated as "Zhongguo Stock".The broad sense of "Zhongquan Stock" includes not only the shares of listed companies directly controlled by capital in China,but also the shares of companies listed on the Hong Kong Stock Exchange whose main business and assets are controlled by capital in Hong Kong.In the narrow sense,"Zhongquan Stock" only refers to the latter.In the 1990 s,Chinese companies launched five listings in the United States.Especially in 2009,the shares of Chinese companies listed in the United States rose by more than 100%.Investors also called these stocks "Zhongguo Stock".Up to now,the number of Chinese companies listed in the United States has exceeded the number listed in Hong Kong.The research object of this paper is China's stock listed in the United States.At the initial stage of listing in the United States,China's stock companies received certain financial support and their own development was also promoted.However,with the financial crisis in 2008,the financing capacity of overseas capital markets has declined.After 2010,some of China's stock market was exposed to fraud scandal and the credit crisis of VIE structure triggered by unilateral termination of VIE agreement in 2011,and the recognition degree of overseas capital market to China's stock market was reduced.Overseas capital market's recognition of China's stock market declined.As a result,the stock price of many medium-sized companies has been depressed for a long time,their liquidity is poor,their value is underestimated and financing is difficult.Some listed companies have not refinanced in the past 10 years,and their development is severely limited.During this period,the activity and valuation of China's stock market transactions have been rising,the construction of multi-level capital market has been gradually improved,and the regression resistance of China's stock market has gradually decreased,and the way of regression has also shown more and more possibilities.As a result,since 2014,a large number of CIMC shares have begun to withdraw from overseas privatization and seek to return to China's capital market.Including Giant Networks,Jiayuan Century,Home Inn,Jingao Solar Energy,Storm Technology,Focus Media,SouFang Networks and so on,all of them have delisted from the United States and listed in A shares.However,the returned companies are not giants in the Internet field.On November 3,2017,Qihoo 360 returned to Jiangnan Jiajie,a backdoor A-share listed company.360 is not only the largest Internet giant that has successfully returned to A shares,but also the largest one among the companies that have returned to China.As the first Internet leading enterprises to return,Qihoo 360 has a large number of users in China,which is undoubtedly the focus of attention in the upsurge of Zhong guo stock return.There are many links and problems involved in the return of overseas Chinese stock estimates,including the scheme of privatization delisting,the operation of dismantling VIE framework,the choice of regression model and the choice of return plate.However,up to now,there are not many successful cases of the return of China's proposed shares overseas,and there are fewer cases of large Internet companies.Moreover,the relevant research and analysis are mostly focused on the return risk of China's proposed shares and the delisting of privatization.There is a lack of complete research on the whole process and path of the return of China's proposed shares to privatization,and also a lack of tracking and Research on the change of enterprise value after the return of China's proposed shares.This paper takes the Qihoo 360's return case as the main object,and analyses in detail the background,transaction structure and process,reasons,regression scheme and path of Qihoo 360 cases.It reveals the reasons for Qihoo 360's successful backdoor listing.Qihoo 360 combines its own development strategy,regulatory policies and various costs in the process of returning.Finally,it chooses the traditional way of returning backdoor listing company Jiangnan Jiajie,and finally achieves a successful return.Through the research and analysis of the effect of Qihu 360's return,this paper proves the feasibility of Qihu 360's return through backdoor listing.After Qihu 360's return,it started refinancing,and the company's profitability was enhanced.On this basis,this paper makes an analysis of the possible impact of the trend of the return of China's stock estimates,and puts forward corresponding countermeasures and suggestions for enterprises and regulators.The return of Zhong guo shares should be based on the actual situation of itself,the regulatory environment and the cost and other factors to consider the way and path of the return.It is hoped that this paper can provide some useful experience and inspiration for those overseas Chinese companies that have started or will start their return,especially the high-quality Internet technology companies.