CITIC SEC has released a research report stating that the latest optimization of refinancing measures significantly improves policy coverage and market coordination. Unlike previous reforms that primarily targeted specific sectors such as the STAR Market, this round involves simultaneous measures from the Beijing Stock Exchange, Shanghai Stock Exchange, and Shenzhen Stock Exchange, forming a multi-layered, market-wide coordinated reform framework.
In terms of specific focus, the measures precisely target two core groups: first, high-quality listed companies with market representation and standardized governance, which will receive optimized review processes to support their development of a "second growth curve"; second, technology innovation enterprises at various development stages, which will benefit from inclusive arrangements to meet their reasonable financing needs. This design, which supports both mature high-quality enterprises in scaling up and innovative small and medium-sized enterprises in their growth phase, reflects a balanced systemic approach of "supporting excellence" and "supporting technology," ensuring both large and small firms are considered. It represents a significant step in improving the investment and financing functions of the capital market and promoting coordinated development.
In terms of investment themes, during the "15th Five-Year Plan" period, the transformation and upgrading of China's economic structure and the deepening reform of the financial system are occurring in tandem, creating substantial strategic depth for securities firms' investment banking businesses. CITIC SEC recommends focusing on securities companies with strong investment banking capabilities and abundant project pipelines. The main views of CITIC SEC are as follows:
Event: On February 9, 2026, the Shanghai, Shenzhen, and Beijing Stock Exchanges announced a package of measures to optimize refinancing. Our analysis is as follows:
Background: The three major exchanges announced the measures simultaneously, expanding coverage. On June 18, 2025, the China Securities Regulatory Commission (CSRC) issued the "Opinions on Establishing a Sci-Tech Innovation Growth Layer on the STAR Market to Enhance Institutional Inclusiveness and Adaptability," explicitly proposing to "improve the convenience of refinancing and optimize the criteria for identifying strategic investors." On January 16, 2026, at the CSRC's 2026 System Work Conference, the regulator clearly stated it would "enhance the inclusiveness and adaptability of the multi-level equity market, initiate and implement reforms to deepen the ChiNext Market, continuously promote the implementation of STAR Market reforms, improve the convenience and flexibility of refinancing, and facilitate the high-quality integrated development of the Beijing Stock Exchange and the New Third Board." The current optimization of refinancing measures, announced simultaneously by the three exchanges, implements and expands on the regulatory requirements for the capital market to serve high-quality enterprises, support technological innovation, and enhance financing efficiency.
Principles: Core principles are highly consistent, emphasizing support for excellence and technology. All three exchanges have put forward the following four principles: adhering to goal-oriented and problem-oriented approaches; supporting high-quality firms and limiting inferior ones while backing technological innovation; balancing risk prevention and strong supervision with high-quality development; and maintaining progress while ensuring stability. We believe that the three exchanges, following top-level design, are highly coordinated and unified in their deployment, which will better guide resource allocation.
Main Content: Under strengthened supervision and risk prevention, efforts are focused on enhancing the inclusiveness and flexibility of refinancing for technology innovation enterprises and high-quality companies, while encouraging second growth curve businesses. First, further support is provided for high-quality listed companies to pursue innovation and development. For high-quality listed companies with standardized operations, governance, and information disclosure, as well as market recognition, the refinancing review process will be optimized to further improve efficiency. The process will adhere to the principle of selecting the best and avoiding mediocrity. These companies are supported in using raised funds for new industries, business models, and technologies that synergize with their main businesses, directing investment toward second growth curve activities, while strictly preventing blind cross-sector or diversified investments. The statements from the three exchanges show no significant differences in this regard.
Second, inclusiveness and adaptability for technology innovation enterprises are increased. All three exchanges explicitly allow listed companies whose shares are trading below issue price to conduct reasonable financing through methods such as competitive pricing placements and convertible bond issuance, requiring that raised funds must be directed to main business operations. Simultaneously, they all provide refinancing support for technology enterprises listed under non-profit standards that have not yet achieved profitability, reflecting a common policy of inclusiveness. However, there are differences in implementation: the Shanghai and Shenzhen exchanges clearly proposed an optimized interval arrangement, stating that "if the previous raised funds are substantially used up or the use has not changed, a new round of financing can be initiated six months after the previous funds were received." They also mentioned researching and formulating identification standards for "light-asset, high R&D investment" main board listed companies. The Shenzhen exchange explicitly relaxed restrictions on the proportion of funds raised that can be used for working capital supplementation for qualifying enterprises, showing a refined design for financing pace and qualification assessment in mature markets. In contrast, the Beijing Stock Exchange's statements focus more on principled support, without specifying quantitative standards such as intervals, which aligns with its market positioning of serving innovative small and medium-sized enterprises, emphasizing overall adaptive support for early-stage tech firms while maintaining regulatory flexibility.
Third, efforts are made to enhance the flexibility and convenience of the refinancing mechanism. All three exchanges require listed companies to briefly explain the use and subsequent plans for previously raised funds when disclosing refinancing proposals, and clarify that the requirement for funds to be "substantially used up" is adjusted to the application stage. They all allow refinancing application materials to directly reference already announced content to avoid duplicate disclosures and reduce compliance costs for enterprises. Each exchange also proposed optimizing the negative list for simplified procedures. The Beijing Stock Exchange additionally noted that if annual or semi-annual reports update financial data during the review period, the updated content can be directly referenced.
Fourth, supervision throughout the entire refinancing process is strengthened. All three exchanges have established a mechanism for disclosing proposals that strictly prevents "applications with issues," and consistently emphasize holding listed companies and intermediaries accountable, strengthening supervision over the use of raised funds, and increasing penalties for violations during and after the process, reflecting a shared philosophy of strict supervision.
Risk Factors: Unanticipated significant declines in stock and fund trading volumes; tighter-than-expected IPO and refinancing policies; unanticipated declines or increased volatility in the secondary market; exposure to customer credit risks; underperformance in company strategy execution; slower-than-expected progress in capital market reforms.
Investment Strategy: The optimization of these refinancing measures represents a significant enhancement in policy coverage and market coordination. Unlike previous reforms focused on specific boards like the STAR Market, the simultaneous package of measures from the Beijing, Shanghai, and Shenzhen exchanges creates a multi-layered, market-wide coordinated reform landscape. In terms of specific direction, the measures precisely target two core groups: high-quality listed companies with market representation and standardized governance, supported through optimized reviews to develop their "second growth curve," and technology innovation enterprises at various stages, accommodated through inclusive arrangements to meet their legitimate financing needs. This design, supporting both mature high-quality firms in strengthening themselves and nurturing growing innovative SMEs, fully embodies a systemic approach that balances "supporting excellence" and "supporting technology," catering to both large and small enterprises. It is a crucial practice for improving the capital market's investment and financing functions and promoting their coordinated development.
Regarding investment themes, during the "15th Five-Year Plan" period, the synergy between China's economic restructuring and upgrading and the deepening reform of the financial system opens up vast strategic depth for securities firms' investment banking businesses. It is advisable to focus on securities companies with strong investment banking capabilities and rich project reserves.
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