Everbright Securities cautious on HK listing
China Everbright not rushing planned Hong Kong initial public offering of its Shanghai-listed brokerage Everbright Securities in the wake of the stock market turmoil
China Everbright Limited is not rushing the planned Hong Kong initial public offering of its Shanghai-listed brokerage Everbright Securities in the wake of the stock market turmoil.
"The market conditions are turning more complicated, and we will wait and see how the Hong Kong market goes when it comes to the proposed Hong Kong listing of Everbright Securities," said Chen Shuang, chief executive of the Hong Kong investment arm of state-owned financial conglomerate China Everbright Group, on Thursday at its results briefing session.
The brokerage arm had said in March its board had approved a plan to sell 680 million shares in Hong Kong, joining other securities firms from China looking to raise funds in the city amid a rally that started in November.
China Everbright also said it will accelerate its mergers and acquisitions overseas and cross-border financing business, with its US dollar exposure set to boost its performance in the second half.
Everbright posted a 180 per per cent year-on-year surge in interim net profits to HK$3.23 billion. Net profit from Everbright Securities for the six months ended June 30 leapt more than tenfold to HK$2.03 billion from a year ago. The Hong Kong business more than doubled its net profits to HK$776 million, helped by soaring fund management fee income.
The earnings spike came in a period of bull run, before China's markets were gripped by the volatility and uncertainty that has become the norm since June.
Chen said that to maintain the momentum, the group needs to work on "diversifying" its business exposure and look for M&A opportunities outside China.
"In view of the prospects of yuan depreciation, we consider it is probably a good time to continue to develop our global M&A funds and US dollar funds in order to meet rising demand in the future," Chen said.
