Recently, Bojiang Holdings Limited (Bojiang for short) submitted a prospectus to the Hong Kong Stock Exchange to be listed on the main board of the Stock Exchange. Everbright Securities International and Deutsche Bank are co-sponsors.
$Broad General Holding Limited (810509.HK)$A leading private equity fund manager focusing on serving high-net-worth individuals and empowering high-tech enterprises in China.
According to data, Mr. Luo Yu, Ms. Yang Mengqiao, Broad Master, Broad Honor, Broad Lucky, Top King, Xing Guang, Gold Luck, Broad Lakeside, Hui Cheng, Broad Oakheart, Hui Yan, and Broad Mind are a group of controlling shareholders of the company.
(Shareholding structure diagram, image source: prospectus)
The company completed the filing of the first private equity fund under management on May 18, 2016. As of December 31, 2022, the company's total asset management scale was about RMB 9.343 billion, making it the second largest private equity fund manager in China focusing on serving high-net-worth people; the company ranked first among private equity fund managers focusing on investing in high-tech industries.
As of December 31, 2022, the fair value of portfolio companies with shares held by corporate funds was approximately RMB 8 billion. Among portfolio companies,Five companies have grown into unicorn companies valued at over $1 billion.
Bozheng said that out of the 87 current portfolio companies currently invested, there are 75 high-tech companies in different fields, accounting for about 95.8% of the company's total investment costs. Compared to other industries, the high-tech industry has a longer exit cycle, which is a challenge to the patience and vision of investors.
As of December 31, 2022, Expo will manage a total of 74 funds, with an overall internal rate of return of about 18.7%. These funds mainly raise capital from external investors.
(Overview of the company's fund's performance, image source: prospectus)
It is worth noting that in 2022, the company's DPI (the share of income from liquidated or partially liquidated portfolio companies and the distribution of portfolio companies divided by paid-in capital) was high, mainly due to the company's partial withdrawal from investment in certain portfolio companies in 2022.
As of December 31, 2022, the company has fully or partially withdrawn from investing in 7 companies. The total investment cost is about RMB 433.8 million, achieving an exit value of about RMB 1.2 billion, and MOIC has reached about 2.8 times.
In fact, for LPs, in private equity investment activities, the cash return they actually receive from the fund does not match the fund's IRR (internal rate of return) shown to them by GP, and DPI can more directly reflect the “real money” return. As a result, the DPI indicator has received more attention.
Among Bojang's products, the Chuangfu series performed the best. Its internal rate of return, net internal rate of return, MOIC, DPI, and TVPI were 21.3%, 20.5%, 3.2 times, 55.9%, and 2.9 times, respectively.
(The performance of the company's various products, image source: prospectus)
In terms of operating performance, the company's revenue mainly comes from expense income from fund management business and investment income obtained by investing its own funds in managed funds. During the reporting period, the company's total revenue was approximately RMB 122 million, RMB 215 million and RMB 212 million respectively, while annual profits were approximately RMB 53.597 million, RMB 99.2.27 million and RMB 107 million respectively.
(Summary of comprehensive profit and loss and other comprehensive income statements, image source: prospectus)