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Original title: Xiaomi financing of 30 billion after two years of listing, does the timing of the market surprise?
Hong Kong’s stock market, dominated by institutional investors, is not always so favorable to “discounted” companies.
Following the release of the beautiful quarterly report, in the context of a large number of sell-side analysts supporting a target price of over 30 Hong Kong dollars,Xiaomi Group-W(01810.HK) on the morning of December 2ndSuspensionBased on the previous price, a “10% discount” positioning, expects to raise about 30 billion Hong Kong dollars,Resume tradingSubsequently, it plummeted by almost 10%.
At noon on December 2, Xiaomi Group made an announcement stating that it would sell 1 billion shares at HK $ 23.7, with a net funding of US $ 3.06 billion. It plans to issue $ 855 million convertible bonds maturing in 2027, with an initial convertible price of CAD 36.74. The two loans amounted to nearly 4 billion US dollars, or about 30 billion Hong Kong dollars.
The total amount of the above two loans is higher than Xiaomi Group’s July 2018 IPO net loan of 24 billion Hong Kong dollars, and Xiaomi Group’s total funding after listing is also expected to exceed 50 billion. Hong Kong dollars.
The placement of approximately 1 billion shares, equal to approximately 4.1% of the total shares issued at the date of the announcement, and approximately 4.0% of the total shares issued after completion of the subscription. The placement price is HK $ 23.7, which will be placed by the manager with no less than six independent professional institutions or individual investors. The placement price is HK $ 26.15 compared to the closing share price on the last day negotiationPremiumAbout 9.4%; a discount of approximately 9.9% off the average closing price of HK $ 26.29 per share for the last five consecutive trading days.
Regarding this type of discount placement, Wen Tianna, non-executive chairman of Broad Financial Holdings, told CBN reporters that Xiaomi Group has issued bonds and placements before the end of the year. Some investors felt this was an opportunity to seize the high share price and take advantage of the situation to expand. The high amount of funding has also led to short-term setbacks in share prices, which surprised investors in the sensitive end of the year. Investors who subscribe to convertible bonds are estimated to be unwilling to bear short-term price fluctuations.
The Xiaomi Group’s hunger for funds isn’t just about discounts. Xiaomi Group intends to issue zero coupon guaranteed convertible bonds maturing in 2027 at an initial conversion price of HK $ 36.74 per share.The initial conversion price is approximately 40.5% above the closing price of 1 December.
A Hong Kong equity fund manager told a China Business News reporter that convertible bonds have both equity and debt ownership, and have the “push and pull and defensive” characteristics. When the stock price goes up, the price of the convertible bonds goes up and when the stock price goes down When, the convertible bonds havePure debt valueprotection of. Xiaomi Group’s share price has undergone a profound adjustment after its listing in 2018. This year, the share price has improved significantly as the business grows. Some investors don’t want to put up with fluctuations in share prices to short term, but howLong-term investmentOptimistic about Xiaomi’s development, the 40% premium of the conversion price isn’t actually low.
Xiaomi Group has stated that it intends to use the net proceeds of the bond issue and placement and subscription to increase operating capital to expand the business, invest to increase the share of the main markets and invest in the strategic ecosystem. The bond issue has the opportunity to expand the equity base and diversify the shareholding structure, improve corporate liquidity, reduce the company’s financing costs and increase working capital.
In the third quarter of 2020, the Xiaomi Group’s revenue was 72.16 billion yuan, up 34.5% year-on-year, adjustedNet profitIt was 4.128 billion yuan, an 18.9% year-on-year increase. In the third quarter, parent company’s adjusted revenue and net income slightly exceeded market expectations and both set an all-time high for only one quarter. According to data from Canalys, in the third quarter of 2020, the global smartphone shipments of the Xiaomi Group rose to number 3.market shareBreaking a record, climbing to 13.5%.
However, the cash flow situation of the Xiaomi Group in the first three quarters was not optimistic: the net liquidity from operating activities decreased by almost 40% year-on-year to 8.35 billion yuan.
After the announcement of the three quarterly reports with a nice performance, before the Xiaomi Group released the above financial plan, many brokerage analysts “raised the flag” for the Xiaomi share price.
On November 30, Essence International analyst Wang Yang said that considering that the various sectors of the Xiaomi Group are still in a predictable state of high-speed growth in the future, some senior executives have been introduced to improve operational efficiency during the period and gave a target price of 29.4 Hong Kong dollars per share. November 28Haitong SecuritiesAnalyst Wang Liting said that Xiaomi has a complete layout of product circles, built a strong ecological chain system, built low-cost online and offline channels, formed a single model “hardware + channel + Internet”, “mobile phone + Internet service IoT “three-wheel drive, growth Both space and efficiency are expected to maintain rapid growth in scale and users.
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Responsible director: Chen Zhijie
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