► Semiconductor companies and software developers grew significantly.
► The largest firms’ stocks appeared among the marketplace’s laggards.
This article is a part of EqualOcean's 'The Star Market Overview 1Q 2020' report.
The first quarter of the new decade has marked a place for itself in the economic history books, as well as in countless case study materials for business schools and their future students. Now, we are facing, arguably, the new millennium’s most enormous black swan in all its glory.
While the COVID-19 pandemic is more than unpleasant for many, some have emerged as short-term winners. Take for example the Nassim Taleb-advised fund that reported a fortyfold return in January– March 2020.
China, the most likely ground-zero of the current disaster, which had quickly recovered from the disease, found itself having the best-performing stock market planetwide. In fact, nothing good can be said about this ‘outlier.’ It simply didn’t go down by double-digit percentages, recording just moderate losses.
Nonetheless, some parts of the mainland’s public equity system did particularly well. The fortunate few are the local technology stocks. EqualOcean sorted the wheat from the chaff in the previous articles, touching upon both the recent performance of the Shenzhen and Shanghai Nasdaq-like boards and their dominance on the country’s IPO scene. The Star Market, for instance, saw two dozen new offerings over the first three months of 2020.
This time, we present a snapshot of the 70 companies that went public in Shanghai’s new venue last year, focusing on their annual revenue growth and the stock trading behavior in the first quarter of 2020.
The board-wide increase in the combined free float surpassed 4%. As always, the game saw quite a few leaders and laggards. The former includes nine companies that have managed to add at least an extra one-fifth to their market caps. For one, Shenyang-based semiconductor firm KINGSEMI (688037:SH) nailed it, growing by over 65% in the first three months of 2020. AMEC (688012:SH) as a runner-up, boosting its size by almost half.
The biggest companies on the board didn’t look alright this quarter. Train control system giant China Railway Signal & Communication (CRSC, 688009:SH) plunged by more than 9% (the firm made CNY 7.6 billion in revenue in 2019). Transsion Holdings (688036:SH), a challenger of Xiaomi (1810:HKEX), BBK Electronics and other low-end smartphone vendors, took a 6% dip.
Chipmakers and software enterprises showed the best performance among the industry-level clusters. The two groups were up by 14.50% and 17.91%.
Read more about the Star Market in the latest EqualOcean quarterly report.