Securities Times | The First STAR Market GDR Issued and Plans to List on the SIX Swiss Exchange on February 22
From Securities Times
On the morning of February 17, 2023, Zhejiang HangKe Technology Incorporated Company (hereinafter referred to as Zhejiang HangKe Technology) announced that it had issued Global Depositary Receipts (GDRs) on February 16, 2023 Swiss time, at a price of 13.69 dollars each. They are scheduled to be listed on the SIX Swiss Exchange on February 22, 2023, marking the successful landing of the first STAR Market GDR.
Since the beginning of the year, apart from huge enthusiasm for GDRs, the STAR Market has seen rapid growth in equity and bond financing. Relying on the capital market, STAR Market companies actively promote production expansion and R&D to support the good start of China's industrial economy.
Seven STAR Market companies have planned to issue GDRs
In September 2022, Zhejiang HangKe Technology disclosed for the first time that it planned to issue GDRs overseas and list them on the SIX Swiss Exchange. The issuance was officially completed on February 16, 2023 in Switzerland local time, representing the successful landing of the first STAR Market GDR.
According to the announcement, Zhejiang HangKe Technology would issue 12,625,697 GDRs at a price of 13.69 dollars each, raising a total of about 173 million dollars. They are scheduled to be listed on the SIX Swiss Exchange on February 22, 2023 Swiss time.
Zhejiang HangKe Technology is among the first batch of listed enterprises on the STAR Market. As a leader in lithium back-end equipment in China, the company leads the industry in terms of revenue scale and profitability. Mainly engaged in the production and manufacturing of back-end equipment for lithium batteries, it has core technologies and capabilities in the R&D and production of core equipment for post-processing systems such as charge/discharge machines and internal resistance testers. The company has been included in the supply chain of international leading battery factories such as LG Energy Solution, Samsung SDI Co Ltd. and SK ON, and has established close cooperation with famous domestic lithium-ion battery manufacturers such as Contemporary Amperex Technology Co., Limited, Ningde Amperex Technology Ltd. and BYD Company Limited.
As a leader in lithium-ion equipment, Zhejiang HangKe Technology reported a substantial growth of full-year performance in its 2022 annual performance forecast, with net profit expected to be 450 million yuan to 550 million yuan, up by 91.39% to 133.93% year on year, and net profit attributable to the parent company after deducting non-recurring gains and losses to be 423 million yuan to 523 million yuan, up by 155.33% to 215.69% year on year.
According to Zhejiang HangKe Technology, the issuance of GDRs and listing on the SIX Swiss Exchange will help the company to further promote its strategy of putting emphasis on both domestic and overseas markets, strengthen the layout of overseas markets, promote the construction of overseas factories, deepen cooperation with international leading customers, and effectively enhance its international reputation and market position. Also, this can further improve its R&D, production and sales system of lithium equipment, promote product renewal and iteration, reduce costs and increase efficiency.
Since the release of new rules on the depositary receipts business under the Stock Connect in February 2022, the institutional opening up of the capital market has made new breakthroughs. The STAR Market takes initiative to connect to the international market and supports the two-way connectivity between domestic and overseas listed companies, so that GDRs become a new channel for STAR Market companies to raise funds overseas.
So far, seven STAR Market companies have released announcements on planning to issue GDRs. In addition to Zhejiang HangKe Technology, the GDR issuance applications of Zhejiang Supcon Technology Co., Ltd., Eyebright Medical Technology (Beijing) Co., Ltd. and Kunshan Dongwei Technology Co., Ltd. have been accepted by the China Securities Regulatory Commission (CSRC), covering new energy, high-end equipment manufacturing, biomedicine and other emerging industries. Changchun Bcht Biotechnology Co., a state-owned enterprise, is actively involved as well.
Capital boosts a hot start of the STAR Market
At the beginning of the year, STAR Market companies started with full vigor. As a number of companies rolled out refinancing plans to launch projects, expand capacity and promote R&D, the year 2023 got off to a hot start. Since this year, companies on the STAR Market, including Gch Technology Co., Ltd., Jiangxi Yuean Advanced Materials Co., Ltd., Kede Numerical Control Co., Ltd., Kaili Catalyst & New Materials Co., Ltd and Shanghai Haoyuan Chemexpress Co., Ltd., have released their refinancing schemes.
As the leader of catalytic materials, Kaili Catalyst & New Materials Co., Ltd proposed to raise no more than 1.075 billion yuan through private placement to invest in new material projects such as the production and recycling of gold-based catalytic materials for PVC green synthesis and the industrialization of high-end functional catalytic materials. The company said that these projects will be implemented closely around the company's main business, and will be an important initiative for the company to seize the development opportunities, enhance and expand its core technologies and advantages, and achieve its strategic development goals, which are expected to increase its production scale, enhance its market competitiveness and reinforce its industry position.
As the leader of domestic five-axis CNC, Kede Numerical Control Co., Ltd proposed to raise no more than 600 million yuan through private placement to invest in the five-axis CNC machine tool intelligent manufacturing project, the serialized five-axis horizontal machining center intelligent manufacturing industrial base construction project, the high-end machine tool core functional components and innovative equipment intelligent manufacturing center construction project and supplementation of current capital. The company said that by implementing these projects, its market share of high-end CNC machine tool will be further increased. With its technical accumulation and mass production experience in high-grade five-axis CNC machine tools, the company will further improve the supply capacity of localized five-axis CNC machine tools, increase the market share of localized products, and promote the process of import substitution.
At the 2023 System Work Conference, the CSRC required to more accurately serve the overall situation of stable growth, and enhance the adaptability and inclusiveness of equity and bond financing and M&A and reorganization policies for sci-tech innovation enterprises. The STAR Market has innovated its refinancing and M&A reorganization system to stimulate enterprises' innovation vitality and constantly improve their market competitiveness. Since its establishment, sci-tech innovation companies on the STAR Market have launched 148 refinancing plans, aiming to raise about 219.471 billion yuan in total. Of these, 91 are in the way of private placement (including 15 small and fast) and 57 are in the way of convertible bonds; 11 companies are planning to purchase assets through issuing shares, and 2 companies have released asset acquisition plans through cash that constitute major asset reorganization.
National Silicon Industry Group Co., Ltd. issued the STAR Market's first sci-tech innovation bond
The STAR Market companies are enjoying increasingly diversified financing channels. In recent years, the CSRC has actively promoted the building of a full life-cycle bond financing support system for sci-tech innovation enterprises. On May 20, 2022, based on the previous pilot, the Shanghai Stock Exchange (SSE) officially launched sci-tech innovation bonds and issued relevant guidelines, which aimed to further enhance the capital market's ability to provide financing services for sci-tech innovation enterprises.
On February 2, 2023, National Silicon Industry Group Co., Ltd., a STAR Market company, announced that the CSRC had approved its registration application to publicly issue sci-tech innovation bonds with a total book value of no more than 1.34 billion yuan to professional investors, becoming the first sci-tech innovation bond issued by a STAR Market company. According to the prospectus, the raised funds will be used for the integrated circuit silicon materials engineering R&D supporting project, with a total investment of 3.457 billion yuan. The completion of the project will make up for China's shortcomings in silicon materials engineering research and application, drive the development of domestic silicon materials supporting industries, facilitate regional sci-tech innovation, and effectively boost continued innovation in the local upstream and downstream industries related to silicon materials.
As shown on the SSE's official website, feedback has been given to the sci-tech innovation bond project of STAR Market company Shanghai Electric Wind Power Group Co., Ltd. The company plans to raise no more than 3 billion yuan, of which 500 million yuan will be used to supplement current capital, 1.5 billion yuan will be used for the construction and operation of new energy projects, asset acquisition or equity investment, and 1 billion yuan will be used to repay interest-bearing liabilities and other purposes that comply with laws and regulations and are recognized by regulators.