Amidst a turbulent market this year, directed share placements have become a renewed focus for public funds as an asset allocation tool. Data shows that by October 22, 37 public institutions participated in A-share private placements, covering 74 companies across 18 primary industries by Shenwan, with a total allocation amount of 30.292 billion yuan, a year-on-year increase of 28.5%. Meanwhile, the overall floating profit reached 10.845 billion yuan, with a floating profit margin of 35.80%, indicating a clear recovery in private placement returns. In terms of individual stocks, 59 private placement stocks received allocations exceeding 100 million yuan, with six stocks garnering over 1 billion yuan, involving popular sectors such as electronics, basic chemicals, and pharmaceuticals. The electronics sector saw the largest private placement scale, with total allocations nearing 9 billion yuan; in terms of returns, cyclic sectors like basic chemicals and non-ferrous metals show higher floating profit flexibility. A public equity investment manager stated, “Rather than saying the private placement market is recovering, it might be more accurate to say that funds are searching for undervalued assets with better cost performance. Over the past few months, most private placement projects have still been priced at a discount, and with the lock-in period shortened to six months, public institutions’ enthusiasm for participation has significantly increased.”
The simultaneous growth in amounts and floating profits reflects a resurgence in mainstream market interest. From a returns perspective, this round of private placements has yielded substantial rewards. By the close of trading on October 22, the total floating profit from public fund private placements had reached 10.845 billion yuan, with an overall profit margin of 35.80%. Among them, 71 stocks achieved floating profits, accounting for 96% of all private placement stocks, with seven stocks having a floating profit margin exceeding 100%. In the basic chemicals industry, Henghe Precision showed a high floating profit, attracting participation from Caitong Fund and Nord Fund, with a total allocation of 271 million yuan, yielding a floating profit of 815 million yuan and a profit margin of 301.08%. Another basic chemicals stock, Jinhua New Materials, also performed impressively, achieving a floating profit margin of 279.36%. Notably, these exceptional returns are not concentrated in traditional popular sectors but rather emerge from relatively niche segments, demonstrating that some fund companies are adopting a contrarian allocation strategy in private placements.
There are also remarkable performances among large-scale projects. Chip manufacturer Chipone Technology Corporation (6885214.SH) participated in private placements from five public institutions, with a total allocation of 1.266 billion yuan and a floating profit of 1.728 billion yuan, yielding a profit margin of 136.52%. AI sector leader Cambricon Technologies Corporation Limited (688256.SH) also attracted participation from eight public funds, although its current floating profit margin stands at only 19.62%, the total floating profit has approached 500 million yuan. These figures not only reflect funding preferences but also showcase public funds’ proactive strategies in industry trends.
In terms of industry distribution, this year's public fund private placements have not concentrated on a single sector, instead presenting a diversified multi-industry allocation pattern. Among the 18 primary industries as classified by Shenwan, 15 industries received private placement allocations of no less than 100 million yuan, with nine industries exceeding 1 billion yuan, underscoring public institutions’ broad asset allocation approach. In terms of allocation amounts, the electronics industry became the absolute favorite, covering 13 private placement stocks including Cambricon, Acm Research (Shanghai), Inc. (688082.SH), Chipone Technology, and Victory Giant Technology (Huizhou) Co.,Ltd. (300476.SZ), with a total allocation of 8.986 billion yuan and an overall floating profit margin of 41.14%. The pharmaceuticals and biotechnology sector ranked second, with allocations totaling 4.518 billion yuan, although some stocks underperformed, resulting in a lower floating profit margin. Furthermore, industries such as power equipment, basic chemicals, and non-ferrous metals also received over 1 billion yuan in private placement fund attention.
When sorted by floating profit margins, the non-ferrous metals industry ranked first, with six private placement stocks collectively having a floating profit margin of 65.49%. Basic chemicals and machinery sectors followed closely, yielding profit margins of 52.35% and 52.27%, respectively. The common characteristic of these three industries is a strong cyclical nature, relatively low valuations, alongside improving supply-demand dynamics, positioning them as “valuation pits” in the eyes of funds. Some industry insiders believe that “the industry preferences reflected in this public fund private placement correspond closely to the allocation logic within a structural market—focusing on high prosperity sectors while betting on rebounds in cyclical sectors.” An anonymous fund manager noted, “Many public funds prioritize private placement projects with higher discount rates, recovering industry prosperity, and relatively concentrated institutional participation. These projects exhibit significant elasticity over a 6 to 12-month cycle.”
In this wave of private placements, Nord Fund and Caitong Fund undoubtedly represent two of the most notable main forces. To date, Nord Fund has participated in private placements for 70 stocks, with allocations totaling 8.896 billion yuan and a floating profit margin of 38.61%. Following closely, Caitong Fund has engaged in 66 stocks with allocations of 8.463 billion yuan, achieving a floating profit margin of 41.03%. These two institutions not only lead significantly in numbers but also achieve good return rewards through large-scale participation. At the same time, well-established public funds such as Yi Fangda Fund, GF Fund, Xingzheng Global Fund, and Huatai-PineBridge Fund have also shown strong performance. Yi Fangda has invested 2.689 billion yuan across ten private placement stocks, with current floating profits of 1.485 billion yuan and a profit margin of 55.24%. Huatai-PineBridge participated in three private placement projects, yielding a profit margin of 17.20%. Notably, some smaller participants have achieved high returns through precise investment points. Nuoan Fund participated in only Chipone Technology's private placement but realized a floating profit margin of 136.52%, showcasing a precise strike; Donghai Fund also achieved an overall floating profit margin of 100.25% through participation in six projects, highlighting the agility and efficiency advantages of smaller institutions.
A fund manager based in Shanghai pointed out, “Public fund participation in private placements increasingly shows a trend of polarization, with one type being large institutions participating in bulk, leveraging scale advantages to reduce marginal costs; while another involves smaller institutions specializing in high-certainty opportunities, relying on accurate industry judgment and valuation systems to seek structural dividends.” It is worth mentioning that although the overall floating profits are generally high, there are certain risk exposures. For instance, three private placement stocks, namely TCL Technology Group Corporation (000100.SZ), Jiahe Foods Industry Co.,Ltd. (605300.SH), and Eyebright Medical Technology (Beijing) Co.,Ltd. (688050.SH), are currently in a floating loss state, with Eyebright Medical facing a floating loss margin of 12%, reminding market participants that while private placements can be lucrative, they require careful timing and prudent engagement.
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