Key Takeaways:
Nanhua has been approved by Chinese regulators for a Hong Kong IPO to supplement its current Shanghai listing
The new share offering would come as the futures company steps up its overseas expansion to meet demand from Chinese businesses going global
When economic uncertainty abounds like it does now, businesses and investors alike typically increase the use of financial instruments to protect against wild fluctuations in the values of their assets. That can be good for business at financial derivatives specialists like Nanhua Futures Co. Ltd. (603093.SH), generating more demand for its services, and helping the company attract investors as it seeks a second listing in Hong Kong.
Late last month, Nanhua received approval from the China Securities Regulatory Commission (CSRC) to go public in Hong Kong to supplement its current listing in Shanghai. The company says it will use most funds from the new listing to expand its global operations.
Among other things, it plans to set up a new base in Malaysia, and to increase the capital bases of its British, American and Singaporean operations for future growth in Europe, the U.S. and Southeast Asia, respectively, according to the company's Hong Kong prospectus filed in April. That document will expire later this month, meaning Nanhua will need to file an updated prospectus for the listing to proceed.
Founded in 1996, Nanhua is one of the oldest futures company in China. Citing third-party research, it says it is the country's largest futures brokerage not affiliated with a financial group in terms of both revenue and commission income from futures brokerage services. And notably, the company touts that it generates the most overseas revenue among all futures companies in China.
Nanhua began to build its overseas businesses in 2006 to provide ...
