The A-share refinancing system is undergoing a systemic restructuring.

On July 3, the China Securities Regulatory Commission released the "Decision on Amending the Administrative Measures for the Registration of Securities Issuance by Listed Companies (Draft for Comments)" (hereinafter referred to as the "Draft for Comments"), introducing reform measures in six major areas: savings shelf issuance, small-amount rapid financing, market-price issuance pricing, controlling shareholder private placements, convertible bond supervision, and fundraising investment directions.

The changes attracting the most market attention focus on two directions: first, establishing a shelf issuance mechanism that allows high-quality listed companies to "register once and issue multiple times"; Second, fully implement market-price issuance, requiring all listed companies to set the issue price on the first day of the offering period as the pricing benchmark date, thereby compressing arbitrage space from the institutional root.

Meanwhile, the upper limit for small rapid financing was raised from 300 million yuan to 600 million yuan, conditions for controlling shareholders' private placements were simplified, and regulations on convertible bonds were tightened simultaneously.

| Storage racks are breaking the ice, small increases are accelerating, and the "board-board price lock effect" is retreating

The main highlights of this refinancing reform are reflected in the following three aspects:

1. Breaking the ice in storage shelf issuance: high-quality corporate financing "use and get cash on demand"

The new regulations place the "storage shelf issuance system" at the forefront. Simply put, it is a good company with standardized information disclosure. In the future, financing can be "registered once and issued multiple times," with the registration quota valid for up to two years.

Previously, every time a company raised a fund, they had to go through a lengthy review process, easily missing fleeting opportunities for R&D or expansion. Now, this is equivalent to issuing a "credit card" to high-quality companies, allowing them to flexibly withdraw funds based on their own progress and market conditions. This not only avoids the impact of large financing on stock prices but also allows the company to precisely seize development opportunities.

2. Upgrade of the small fast track: Quota doubled, no longer exclusive to small tech innovation

To improve financing efficiency, the threshold for small, rapid financing has been significantly relaxed:

Quota increase: The upper limit for the Shanghai and Shenzhen stock exchanges will be raised from 300 million yuan to 600 million yuan (large enterprises with over 10 billion yuan can reach 1 billion yuan), and for the Beijing Stock Exchange, it will be raised from 100 million yuan to 200 million yuan.

Process simplification: Approval can be completed at the extraordinary shareholders' meeting, and the review process is greatly shortened to "2+3+3" working days.

This means that small-scale rapid financing is no longer just a privilege for small tech startups; more midstream manufacturing, consumer, and pharmaceutical companies need technological transformation and cash flow supplementation to benefit from this "fast lane" service. It perfectly complements the issuance of storage racks, balancing "large-value flexibility" with "small-amount efficiency."

3. Fully implement market-value issuance: the era of "board-locked" arbitrage has ended

The new regulations require that all private placements by listed companies must use the "first day of the issuance period" as the pricing benchmark date.

In the past, some private placements allowed price lock on the "board resolution announcement date." Because there is often more than a six-year gap between the board of directors and the actual issuance, subscribers can easily pocket huge price differences unrelated to the company's operations. This cross-period arbitrage has long caused strong dissatisfaction among minority shareholders. The new regulations have completely closed this loophole, making the pricing mechanism more market-oriented and effectively protecting the interests of small and medium investors.

| Controlling shareholder loosening, convertible bonds filling gaps, and raising funds drawing red lines

In addition to the three core reforms mentioned earlier, this new regulation also introduces three sets of "supporting combination punches." These three adjustments may seem minor, but together they form a regulatory loop of "liberalization and control":

1. Controlling shareholder's private placement "untying": Welcoming real cash, rejecting short-term arbitrage

The new regulations have "relaxed" restrictions on major shareholders participating in private placements. As long as the company operates properly and has no serious dishonest behavior, the actual controller and controlling shareholder can more smoothly fund private placements and inject resources into the company.

But to prevent major shareholders from using the name of private placements to "cash in" and make quick money, the new regulations impose a strict restriction: the lock-up period for these shares has been significantly extended from 18 months to 36 months (three years). The logic is simple: encourage long-term capital that truly believes in the company to come in, keeping those who want short-term arbitrage out of the gate.

2. Convertible bond regulatory "filling gaps": plugging the hidden loopholes of "curve financing."

In the past, some companies exploited loopholes to issue convertible bonds and engage in "indirect financing" to circumvent the "cooling-off period" (refinancing interval) restrictions of private placements.

This new regulation directly closes this loophole: it clearly stipulates that convertible bonds, like private placements and rights issues, must comply with the same refinancing interval requirements, and at the same time, they strengthen the review of companies' debt repayment ability to curb blind bond issuance and fundraising activities.

3. Drawing a "red line" in fundraising investment directions: Strictly prohibit moving from real to virtual; focus must be on core business

In the past, some listed companies used the raised funds for wealth management, stock trading, or blind cross-industry mergers and acquisitions, completely betraying their original intention of serving the real economy.

This new regulation directly draws a rigid red line: the money raised must be used for core business activities (such as technology R&D and capacity building). This means that regulatory constraints on the use of funds have officially risen from "recommendation" to "mandatory."

These three measures work together very cleverly. Relaxing the major shareholder's private placement and extending the lock-up period is a push at both the "entry" and "exit" ends; Tightening the regulation of convertible bonds blocks the hidden loopholes in the system; Emphasizing fundraising in the main business controls the "last mile" of fund usage. Together, these three have woven an institutional network of "incentives and regulation, restraint on speculation, and return to the roots."

Kingtech Perspective | Embracing "True Growth," Saying Goodbye to "Institutional Arbitrage"

Fully implementing market-value issuance and extending the controlling shareholder's lock-up period completely seals off the previous opportunities for major shareholders and institutions to exploit "information gaps" and "time lags" for cross-period arbitrage. In the future private placement market, subscribers must rely on long-term confidence in the company's fundamentals to profit, which will force listed companies to solidify their core business and attract long-term capital through core competitiveness.

Focus on high-quality technology leaders with the potential for "shelf issuance."

The biggest beneficiaries of the expansion of shelf issuance and the small fast track are hard tech companies with high R&D investment and intermittent funding needs.

It is recommended to focus on leading companies with standardized information disclosure and those in high-growth tracks (such as semiconductors, AI computing power, innovative drugs, etc.). They can use "credit limits" to precisely match R&D window periods, effectively avoiding excessive equity dilution and greatly enhancing the certainty of performance realization.

Beware of "pseudo-main business" and "curved financing" targets

As the fundraising allocation to the main business is drawn on a "red line" and the gap between convertible bonds and private placements is narrowed, those accustomed to using the funds for wealth management, stock trading, or attempting to circumvent regulations through convertible bonds to raise short-term cash will face significant compliance risks and liquidity pressures. When screening private placement targets, investors must strictly examine the authenticity of their fundraising projects and their industrial synergy, resolutely avoiding "pseudo-growth" targets lacking core business support.