Research On The Path Of China Concept Stocks’ Returning To The A-share Market After Split Business

At the beginning,the threshold for listing in foreign markets was lower than that in domestic markets.Many domestic enterprises began to choose to list abroad one after another.However,starting from 2011,the development momentum of the domestic market began to catch up with that of the foreign market.Many Chinese stocks encountered a short-selling crisis abroad,resulting in a poor performance of the stock market and a much lower valuation abroad than in the domestic market.In this context,starting with Storm Technology,a Chinese stock whose market value has increased 34 times since its successful return in 2015,the Chinese stock listed overseas earlier started a return upsurge one after another.At the present stage,in order to guide the return of high-quality Chinese stocks,relevant departments have formulated systematic policies to open up a green channel for their return to the maximum extent.From this,it is speculated that more high-quality Chinese stocks will choose to return to the domestic market in the future,and it is particularly important to conduct professional research on a series of problems related to the return phenomenon.This paper takes SFUN,the first enterprise to return through the"split+backdoor" model,and Wuxi AppTec,the first enterprise to return through the"split+IPO" model,as an example to study their return path.The regression path can be roughly divided into two steps:first,splitting the business;second,re-listing.The two did not choose the path of privatization and delisting to return to the A-share market,but split the diversified businesses.The reasons include the following aspects:First,by splitting the businesses and listing them separately,the financial pressure of enterprises can be reduced,the tens of millions of dollars of privatization funds at every turn can be avoided,the financial pressure during the transformation period of SFUN can be reduced,and at the same time,the financial support for the return of the main body of Wuxi AppTec can be provided.Secondly,to reduce the "negative cooperativity effect" between the different businesses of the parent and subsidiary companies.If the businesses of the parent and subsidiary companies are not related to each other,they will tie each other down and reduce the performance of the enterprise.Each company operates different businesses independently,and the development of each business will be more professional,and relevant information of the business will be more fully and effectively disclosed.The comparison of stock price and market value before and after the split of SFUN and Wuxi AppTec also proves this point.After splitting the business.SFUN and Wuxi AppTec chose different ways to return to the domestic market:SFUN split part of its business and transferred it to the domestic backdoor listing,while Wuxi AppTec transferred its business to the domestic listing through IPO after noticing that regulatory agencies have issued a series of regulations to strengthen the control of backdoor return,decided to use IPO to transfer the business to domestic listing and realize a 50-day flash under various favorable market policies..This paper compares the return operation,return risks and return effects of the two case companies.After summarizing the above results,it draw’s several conclusions and puts forward relevant suggestions for the return of Chinese stocks according to the conclusions:Chinese stocks should carefully analyze and position their business and financial status.On this basis,it should timely select the return time point and return method based on domestic policies and other conditions.