Rate Of Return
Buffett Apprentice[HK IPO] Nanhua Futures, H shares are 34% cheaper than A shares, still dare to subscribe?
Nanhua Futures is a leading futures company in China, providing global financial services to clients. According to the Frost & Sullivan report, we ranked eighth among all futures companies in China by total income in 2024 and first among all non-financial institution-related futures companies by total income in 2024. The Group's primary focus is to provide futures and derivatives services in the domestic and international markets.
The company started its IPO on December 12, with an offer price of HKD 12~16, 500 shares per lot, a minimum subscription of HKD 8,080.68, a market capitalization of HKD 8.613 billion to HKD 11.484 billion, and an issuance of 108 million shares. It belongs to the securities and brokerage industry, with a greenshoe option but no cornerstone investors.
The sponsor is CITIC Securities, which has an 85.71% first-day rise rate for projects sponsored in the past two years, with overall strong performance.
In 2024, by total income, Nanhua Futures ranked eighth among all futures companies and first among all non-financial institution-related futures companies, with total income of RMB 5.7 billion. In 2024, by brokerage commission income, Nanhua Futures ranked 16th among all futures companies and first among all non-financial institution-related futures companies, with total income of RMB 500 million.
The company's revenue from 2022 to 2024 was RMB 954 million, RMB 1.293 billion, and RMB 1.355 billion, respectively, with a year-on-year growth of 4.79% in 2024. Net profit from 2022 to 2024 was RMB 246 million, RMB 403 million, and RMB 458 million, respectively, with a year-on-year growth of 13.71% in 2024.
Calculated at the median offer price, the market capitalization is HKD 10.049 billion with an issuance of HKD 1.512 billion, an issuance ratio of 15.05%, and no cornerstone lock-up, meaning all HKD 1.512 billion is freely tradable.
This issuance adopts Mechanism B of the new Hong Kong IPO rules, with an initial public offering share of 10% and no clawback mechanism. Nanhua Futures was previously listed on the A-share market and is now dual-listed on the Hong Kong stock exchange as an A+H share.
The current subscription multiple is 0.93x, still not fully subscribed, indicating weak investor interest.
Subscription Strategy:
Nanhua Futures is a leading futures company in China, ranking eighth among all futures companies. The sponsor is CITIC Securities, with strong overall performance. The company's revenue and net profit have shown steady growth year by year, with relatively stable performance. This issuance adopts Mechanism B of the new Hong Kong IPO rules, with an initial public offering share of 10% and a freely tradable share of HKD 1.512 billion. The current subscription multiple is 0.93x, indicating weak investor interest. Nanhua Futures was previously listed on the A-share market and is now dual-listed on the Hong Kong stock exchange as an A+H share. At the median offer price of HKD 14, the Hong Kong shares are discounted by about 6.6% compared to the A-shares. However, several previously listed A+H shares in Hong Kong have broken their issue prices, so even with a larger discount, I don't dare to subscribe. I plan to give up the subscription!
My comments represent personal views only and do not constitute any investment advice. The stock market is risky, so invest with caution!
$NANHUA FUTURES(02691.HK) $NANHUA FUTURES(603093.SH)
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