On November 8, Shenzhen Securities Information Co., Ltd. (“SSIC”), a wholly-owned subsidiary of SZSE, announced that it would release SZSE Main Board 50 Index (“SZSE Main Board 50”, code: 399750), ChiNext Mid-cap 200 Index (“ChiNext Mid-cap 200”, code: 399019) and ChiNext Small-cap 300 Index (“ChiNext Small-cap 300”, code: 399020) on November 15. Such indices present the stock price trend of innovative blue chip enterprises on SZSE Main Board and the mid and small-cap stocks on the ChiNext Board respectively. This is an important measure adopted by SZSE with focus on the effect of the comprehensive registration-based IPO reform to fully represent SZSE’s multi-tiered innovative growth characteristics, continue to increase the supply of high-quality broad-based indices and meet diversified index investment needs in the market.
Release of the first broad-based index of SZSE Main Board to present the characteristics of large-cap blue chips
After the implementation of the comprehensive registration-based IPO reform, SZSE Main Board highlights the characteristics of “large-cap blue-chip stocks” and focuses on supporting representative strategic pillar industries featuring mature business mode and stable business performance. By the end of October 2023, SZSE Main Board had more than 1,500 listed companies, with a total market value of about CNY 20 trillion, showing the prominent agglomeration effect of innovative blue chips and champions in industry segments. SZSE Main Board 50 not only reflects the stock price trend of top companies listed on SZSE Main Board having large market value, strong industry representation and high fundamental value, but provides investment targets for investors to share the development results of SZSE Main Board.
In terms of the index compilation, SZSE Main Board 50 selects 50 stocks as samples after setting liquidity screening and ESG negative exclusion and comprehensively considering such indicators as market value scale of listed companies, industry status in the A-share market, business performance and growth. This method further highlights the characteristics of SZSE Main Board and enhances the investability of the index.
The average total market value of sample companies selected for SZSE Main Board 50 is nearly CNY 130 billion, showcasing the distinct attribute of large-cap stocks. According to the 2023 semi-annual reports, the selected sample companies had stable business performance, highlighting the role of blue chips as “market stabilizers”. Among them, the income of BYD, SF Holding and Vanke in the first half of the year exceeded CNY 100 billion, and the net profits of GREE and PAB were more than CNY 10 billion. The sample companies have attached great importance to R&D innovation and shareholder returns. In the first half of 2023, their total R&D investment was CNY 100.4 billion, accounting for 43% of SZSE Main Board, and total interim dividends were CNY 7 billion, accounting for 50% of SZSE Main Board.
Improved broad-based index system of ChiNext Board to continuously enrich innovative investment targets
ChiNext accelerates the formation of the development highland for strategic emerging industries based on the characteristics of “superior innovation and high growth” and the positioning of “innovation, creation and creativity”. After more than ten years of development, ChiNext has had more than 1,300 listed companies, with a total market value of nearly CNY 12 trillion, forming a company group having a rich structure of market value scale and industry characteristics. Especially, since the registration-based IPO reform, ChiNext has developed with a wider coverage, greater inclusiveness and greater attractiveness, becoming the consensus direction for additional allocation of medium and long-term capital. The launch of ChiNext Mid-cap 200 and ChiNext Small-cap 300 is conducive to multi-dimension presentation of the market trend of the ChiNext Board, and further enrichment of the market’s observation and investment dimensions of ChiNext.
ChiNext Mid-cap 200 and ChiNext Small-cap 300 are consistent with the ChiNext Index in the main preparation plan. Under the plan, 200 stocks with good liquidity and medium market value and 300 stocks with good liquidity and small market value are selected from the ChiNext market as samples. The average total market value of samples selected by ChiNext Mid-cap 200 and ChiNext Small-cap 300 is CNY 10 billion and CNY 5.2 billion respectively, forming a clear stratification of market value scale with the ChiNext Index (CNY 50.4 billion). The two indices highlight advantageous industries of the ChiNext Board, forming a good complement to the ChiNext Index. Strategic emerging industries under the two indices account for 87% and 71% respectively; among them, the new-generation information technology industry has obvious advantages, accounting for 40% and 25% respectively.
ChiNext Mid-cap 200 and ChiNext Small-cap 300 have a good product development foundation. As estimated, in the past five years, ChiNext Mid-cap 200 and ChiNext Small-cap 300 achieved 63.3% and 73.8% of income respectively. Especially since 2023, the two indices have risen 8.4% and 10.8% against the market. The two indices can provide differentiated broad-based investment targets for the market. ChiNext Mid-cap 200 and ChiNext Small-cap 300 have a lower weight concentration, with the total weight of the top ten weighted stocks being 13.0% and 9.2% respectively. This is conducive to dispersing investment risks of high-growth industries and companies with the small and medium-sized market value.
SZSE attaches great importance to the construction of the SZSE index system. We have released more than 280 SZSE indices, covering such types as broad base, theme, strategy and ESG, to provide investors with rich investment tools to share the development dividend of SZSE. Among them, the ChiNext series of indices represented by the ChiNext Index and the ChiNext 50 have the tracking capital of nearly CNY 120 billion. Since the beginning of 2023, the total net capital inflow of the main ETF has exceeded CNY 35 billion. We have given full play to the capital guidance role of broad-based indices. Next, SZSE will, in accordance with the unified deployment of CSRC, continue to develop and improve broad-based indices and related products. We will enrich the supply of high-quality investment targets, provide diversified options for medium and long-term capital allocation and attract more capital flow, helping the high-quality development of the market.
