[Abstract] At around 10:00 am on April 11, the stock price of China Financial Holdings began to plunge rapidly, with a drop of 80% in half an hour to HK$0.019 per share, becoming the " sen stock ", hitting a new low in the past three years. The dynamic assets are approximately RMB 178 million.
Times Weekly Reporter Li Wanshan Sent from Guangzhou, Shenzhen
Guangzhou Zengcheng, Shatou Village, Sanjiang.
Next to the dusty highway is a large green vegetable field. This is one of the vegetable production bases of Congyu Agriculture in Guangdong Province. At present, this vegetable field with an area of 3,000 acres is planted with vegetable hearts and kale, and some of the land is overgrown with weeds due to idleness. A staff member who did not want to be named told the Times Weekly reporter that as the rain in Guangzhou has increased, rice will be planted in this vegetable field. By autumn, it will be the "Zengcheng Scarecrow Creative Exhibition". "If you come back in autumn, it will be very beautiful and lively."
, 85 kilometers away from here, Shenzhen Futian Economic and Trade Building is the registration place of Congyu Food Trading Co., Ltd. (hereinafter referred to as "Congyu Economic and Trade"), which belongs to the same group. It is also the office location of Green Yidai on the P2P platform. As soon as you enter the door, you can see the four golden characters "China Financial Holdings". The four big words
and the stock code next to them -00875 may make investors feel more secure. However, at around 10:00 am on April 11, the share price of China Financial Holdings began to plunge rapidly, falling by 80% in half an hour to HK$0.019 per share, becoming a "phenolic stock", hitting a new low in the past three years. After that, the bulls and bears competed fiercely. As of the close of April 11, China Financial Holdings fell by 57.48% to HK$0.054 per share. On April 13, the last trading day before the Easter holiday, China Financial Holdings' final closing at HK$0.054.
This reminds people of Huishan Dairy (06863.HK), which was also blood-scrapped in the Hong Kong stock market half a month ago, but the situation of China Financial Holdings and Huishan Dairy is different. The former's performance in recent years has not been satisfactory.
From public information, China Financial Holdings, which once used the name "Congyu Agriculture", started out with agriculture and entered finance in 2015. However, such transformation did not help China Financial Holdings get out of the fate of losses.
became a success in agriculture
According to the statement on the company's official website, the predecessor of China Financial Holdings, Yu Agriculture, was established in 1992. Since 2002, the company has become one of the main suppliers of fresh vegetables in Guangdong Province and Hong Kong, and in 2012 it became "the first national key leading enterprise in agricultural industrialization in China to be listed on the main board of Hong Kong."
In fact, before April 2012, "00875" was named "Real-fa International". Lianfa International has been engaged in the cultivation, sales, and trading of forest seedlings and seeds. Judging from the disclosed financial data, Lianfa International suffered losses for years and encountered a relatively serious liquidity crisis. Later, Lianfa International looked for various ways to get rid of the crisis, but most of them ended in vain.
In July 2011, Lianfa International issued an announcement stating that the company would purchase all the equity of Congyu Group for HK$143 million, while at the end of 2010, Lianfa International's total assets were only HK$1.391 million. Congyu Group acquired approximately 19.24% of Lianfa International's equity through this transaction and went public through a backdoor listing.
It is worth noting that just before Congyu Group, Lianfa International acquired Tianyuan Food and Bailigao Food with wholly owned capital. Public information shows that Tianyuan Food was previously a supplier of Lianfa International and has a processing center with an area of about 2,320 square meters in Dongguan; Bailigao Food is one of the main suppliers of Hong Kong Huikang Supermarket. Lianfa International stated that the purpose of the acquisition is to enable the company to become the leading distributor of vegetables for Hong Kong . Public data from
shows that Congyu Group's turnover in 2009 was approximately HK$90 million, and its after-tax profit was approximately HK$16 million. In comparison, as of the first three quarters of 2009, the book value of Tianyuan Food was negative HK$318,000, and the book value of Bailigao Food was HK$1.628,000; while Lianfa International lost HK$7.117 million in 2009, which can be imagined from the difficulty of integration of Yu Group.
The above three mergers and acquisitions and restructuring projects were all completed at the end of 2011, and the company has entered the "Congyu Agriculture Era".A few months later, "00875" finally released a "positive profit forecast". By the end of 2012, Congyu Agriculture finally turned losses into profits, recording a net profit of approximately HK$31.4 million.
, just that this optimistic mood has not been able to continue. In 2013, Congyu Agriculture lost about HK$58.83 million due to slightly rising revenue. After that, "00875" never released an annual report that satisfies shareholders.
From "From Jade Agriculture" to "China Financial Holdings"
In 2015, the company made a decision to transform. With the change of the company's strategy, "00875" has also changed from "from Yu Agriculture" to "China Financial Holdings".
"00875" is not difficult to understand the anxious mood to transform. To this day, agriculture still needs to rely on the weather, which has been verified in the ups and downs of vegetable prices. A staff member of Congyu Agriculture who did not want to be named told the Times Weekly reporter: "The price of vegetables last year exceeded 20 yuan per kilogram, and last year (vegetable prices) were about seven or eight yuan, but this year, the vegetables we sold were only more than four yuan." The staff member of Green Yidai told the Times Weekly reporter that Guangzhou's labor costs are getting higher and higher, which also puts the company's Hong Kong vegetable business under increasing cost pressure.
Getting involved in financial business is a solution set by China Financial Holdings for itself. In September 2015, China Financial Holdings completed the acquisition of Hong Kong Jinyufu Company. Since Jinyufu Company held 25% of the equity of the P2P platform Green Yidai, China Financial Holdings thus involved in the P2P business; in February 2016, China Financial Holdings indirectly acquired Shenzhen Shenglianfeng Microfinance, which had obtained a license to engage in microfinance business, by acquiring all the equity of Shenzhen Taihengfeng Technology.
Times Weekly reporter learned through a staff member of GreenEdai that China Financial Holdings currently conducts financial business in Hong Kong and the mainland, among which mainland financial business is mainly P2P platforms and micro-loans; and its financial business in Hong Kong also includes private loans and securities investments.
official website shows that Jinyufu Finance, which is engaged in private loan business, has obtained the relevant license in September 2015; another subsidiary Jinyufu Securities has also been approved to become a registered licensed securities company in April 2016.
As for why China Financial Holdings chose P2P platform and microfinance as the starting point for its involvement in the financial industry, Fang Song, president of the Guangzhou Internet Finance Association and president of Guangzhou E-loan, told the Times Weekly reporter that compared with securities and other businesses, it is relatively simple to carry out these two businesses in China.
transformation is weak
China Financial Holdings has been transforming for nearly two years, but most of the company's revenue is still derived from agricultural business. The above-mentioned Green Yidai staff told the Times Weekly reporter that in terms of scale, Green Yidai is not at the forefront of the industry. Since the policy framework of the P2P platform still needs to be improved, the company's current strategy is to "stable and steady" so that the platform can better adapt to policy changes. When introducing the platform to the Times Weekly reporter, the staff member used China Financial Holdings' listing background as one of the advantages of the platform, but emphasized that the platform's lending target has nothing to do with the listed company.
Times Weekly reporter learned that since last year, China Financial Holdings has added new content to its original agricultural business. The above-mentioned staff member of the Yu Agricultural told the Times Weekly that when the rainy season in Guangdong arrives, the company will "go north" to Ningxia to grow vegetables, while the vegetable fields in Guangdong will plant rice to develop the tourism industry.
However, in the newly released 2016 financial report by China Financial Holdings, Times Weekly reporters did not find the impact of the above-mentioned business on the company's performance.
It is worth noting that although the performance of "00875" has been in a loss-making state for a long time, sometimes the company's stock price seems quite exciting. In April 2016, China Financial Holdings announced that it would issue up to 400 million yuan and 2 billion yuan of five-year zero-interest convertible bonds to independent third-party Zhuhai Degu Fund Management and Qianhai Alibaba Fund Management (hereinafter referred to as "Qianhai Alibaba"). As soon as the news came out, China Financial Holdings' stock price soared nearly 60%, and then a spokesperson for Alibaba said that Qianhai Alibaba has no connection with Alibaba Group .
Since its name change, China Financial Holdings has issued shares to increase capital several times, but not every time it has resulted.Although the stock price of "00875" has fluctuated in this announcement after another, due to the ineffective main business of China Financial Holdings and the incomplete transformation, the dilemma of continuous losses in performance has not improved.
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