Why is Xiaomi's performance in the first week of listing?
Despite the unrealistically high valuation, Xiaomi has risen more than 20% in the first week of listing, for three reasons:
The first is that the current circulation of Xiaomi is very small.
Usually IPO companies will be in Hong KongDevelopment10% of the new shares are sold, and the remaining 90% are handed over to the underwriters for the “International Placing”. If the Hong Kong market is oversubscribed and oversubscribed by more than 100 times, the “International Sale of Shares” will be refunded. The stocks that are finally available for sale in the Hong Kong market can account for more than 50% of new shares.
Xiaomi only took 5% of the new shares (109 million shares) for sale in Hong Kong. The callback mechanism was not initiated due to the bleak subscription. Therefore, before the international placement of stocks entered the market (the 252 million shares subscribed by the cornerstone investors had a six-month lock-up period), there were only over 100 million shares in circulation and the market value was about 2 billion Hong Kong dollars. #两三"煤老板" is enough to control the stock price#
The second is that there is a "trayer" at work.
In 2014, when Ali went public, he appointed Goldman Sachs as a “stabilizing market agent”. Goldman's job is to maintain a stable stock price for a certain period of time, which is commonly referred to as a “tray”. Xiaomi did not disclose whether to appoint a “tray hand”, but the first underwriter is Goldman Sachs. However, the circulation disk is so small that it is enough to use the high-altitude sword to slaughter chickens. It is enough for several "little buddies" to stretch out their hands when Ray does not know.
The third is to be included in the Hang Seng Composite Index.
On July 9th, the Hang Seng Index announced that Xiaomi Group meets the requirements of “Fast Inclusion Index” and will be included in the Hang Seng Composite Index and Hang Seng Composite Industry Index – Information Technology Industry, Hang Seng Composite Large-Cap Index, Hang Seng General University after the market close on July 20. The Mid-Cap Index, Hang Seng Global Composite Index and Hang Seng Internet Technology Index came into effect on July 23.
Some investors believe that after the inclusion of the Hang Seng Index, Xiaomi will become the target of investment for a considerable number of investment institutions (especially related index funds), and it will also become a standard for Hong Kong stocks, opening the door for A-share investors.
Hanergy was the first beneficiary of Hong Kong Stock Connect. The “Northern Leek”, which had never seen Hanergy’s products, pulled the market value of this stock to more than 300 billion Hong Kong dollars, and let Li Hejun pass a “first rich addiction”. The trend of funds in the south is also an important factor in determining the stock price of Xiaomi.
Unfortunately, according to media newsThe shares of different voting rights companies are not included in the Hong Kong Stock Connect.
More unfortunately, due to investors' lack of understanding of the Hang Seng Index, it is misunderstood that Xiaomi will be included in the "Hang Seng Index HSI" with only 50 constituent stocks, and it is said that Lenovo is replaced. In fact, Xiaomi will be included in the "Hang Seng Composite Index HSCI" with 484 constituent stocks, which together account for 95% of the total market value of the main board of the Hong Kong Stock Exchange.
Let's take a look at the Hang Seng Index.
Understanding the Hang Seng Index
Hang Seng Index - Hang Seng Index, abbreviated as HSI. It is compiled by the Hang Seng Index Company, which is wholly-owned by Hong Kong Hang Seng Bank. It is based on July 31, 1964, and the base point is 100 points. There were 30 constituent stocks at the earliest. Since 2013, they have remained at 50, and basically one can be included in each one.
For example, on June 17, 2013, Lenovo Group (00992) was included and Chinalco (2600) was excluded. Some media said that Xiaomi replaced the position of Lenovo Group. In fact, it was not related to Xiaomi, but it was done by Shijiazhuang Group (1093).
On January 17, 2018, the Hang Seng Index closed at 3,1983.41, the highest in history. #沪指不半半分的最位的半#
In the last decade, the Hang Seng Index has never exceeded 20 times. In 2018, when the index hit a new high, the price-earnings ratio reached 17.6 times, and in June it fell to 12.2 times.
In January 1985, the Hang Seng Index added four sub-indices, which divided the constituent stocks into four categories: financial sub-index, utility sub-index, real estate sub-index and industrial and commercial sub-index. In June 2018, the price-earnings ratios of the four sub-indices were 11.06 times, 17.19 times, 6.77 times and 18.46 times, respectively.
The threshold of Hang Seng Index constituent stocks is very high. In addition to high market value and large turnover, it also requires “24 months of listing”, “large business in Hong Kong” and “health health”.Lenovo was listed on the main board of Hong Kong in 1994. It was included in the Hang Seng Index in 2013 and was removed in 2018. The Country Garden and Geely Automobiles, which were included in 2017, were listed in 2007 and 2004 respectively (Geely is listed on the backdoor).
Those who have a little understanding of the capital market know that the "new stocks" and "secondary stocks" are erratic. A-shares have dozens of daily limit storms. The break-up of new stocks on the Hong Kong Stock Exchange is normal and the waist-stricken ones are not too small. The ten trading days were included in the Hang Seng Index, which represents the stock price trend of thousands of listed companies in Hong Kong. It is very imprecise and the Hang Seng Index Company will not make fun of its reputation.
Xiaomi is about to be included in the Hang Seng Composite Index, and the threshold is much lower. There are 484 constituent stocks, divided into 11 industries.. Xiaomi will also be included in the "Information Technology Industry" sub-index, which has 36 constituent stocks, includingTencent, Lenovo, NetDragon, Wenwen, ZTE, Mito, Fuzhikang, Jinshan Software, etc.
Xiaomi will also be included in the "Hang Seng Integrated Large and Medium-Cap Index".This is one of the many indexes compiled by the company. The index currently has 298 constituent stocks, with an average P/E of 12.44 times in June 2018.
The Hang Seng Index faces "cage change for birds"
In 2017, the Hang Seng Index removed 4 stocks including Kunlun Energy, Cathay Pacific, Belle International, and Li & Fung, and replaced them with Sunny Optical, Wharf Real Estate, Wanzhou International and Geely Automobile. However, individual stocks from traditional industries such as finance and real estate still have an absolute advantage.
As of June 2018, the total market capitalization of Hang Seng Index constituent stocks was HK$18.9 trillion, accounting for 57.28% of the total market value of the main board.
Among the 50 constituent stocks, there are 12 financial stocks with a total weight of 47.78%; 11 real estate stocks totaling 10.95%; 12 are from three traditional industries (energy, manufacturing, services) with a total weight of 13.47%. The above 35 stocks from traditional industries have a total weight of 72.2%.
Among the 50 constituent stocks, only Tencent and AAC Technologies are in the information technology category, with weights of 10.32% and 0.88%, respectively, totaling 11.2%.
The industry distribution of Hang Seng Index constituent stocks is obviously out of touch with the times. The stocks representing the new economy are seriously inadequate and must be caged for birds.
It is expected that the weights will be ranked lower by the traditional industry and will be replaced by Xiaomi, Meituan and Ant Financial. In particular, Sino Land, Henglong Real Estate, and China Want Want, whose weights are less than 0.5%, have a high probability of giving way to the new economy. but,That is after two or three years..