Futu News on October 30th, this FridayXiangsheng Holdings Group (02599.HK) $According to the announcement, the company plans to issue 600m shares from October 30th to November 11th, of which 60 million shares will be sold publicly and 540 million shares will be offered internationally at an issue price of HK $4.80-6.22 per share, 1000 shares per share, which is expected to be listed on November 18.

It is reported that Xiangsheng Holdings Group is a large, fast-growing comprehensive real estate developer headquartered in Shanghai and deeply cultivated in Zhejiang Province, focusing on the development of high-quality residential properties in selected areas of China. As of July 31, 2020, the Group has 205 property projects at different stages of development, including 181 for subsidiaries and 24 for joint ventures and associates.

According to the China Real Estate Index system, in terms of contract sales, the Group ranked third among all residential property developers in Zhejiang Province in 2019, accounting for about 5.1% of the total property contract sales in Zhejiang Province. In terms of contract sales, the company ranked 28th among all developers in China in 2019, accounting for about 0.7% of total domestic property contract sales, according to China Real Estate Information Group.

In terms of financial data, the company's total income from fiscal year 2017 to fiscal year 2019 was 6.293 billion yuan, 14.215 billion yuan and 35.52 billion yuan respectively, with a compound annual growth rate of 137.6%. In the same period, net profit (after tax) was-286 million yuan, 428 million yuan and 3.209 billion yuan respectively. In the first four months of 2020, the company recorded a profit of 8.552 billion yuan, an increase of 123% over the same period last year, and a net profit of 600 million yuan.

In terms of industry, with the rapid increase of economy and fixed asset investment, China's real estate market has still achieved rapid growth in recent years. At the same time, the acceleration of urbanization and the upgrading of consumption drive the demand of the residential property market. Registered residential property investment was RMB 9.707 trillion in 2019, with a compound annual growth rate of 8.6 per cent from 2014 to 2019. Over the same period, the floor area of residential properties sold grew at a compound annual growth rate of 7.4 per cent, while the average price of residential properties soared to 9287 yuan per square metre in 2019, with a compound annual growth rate of 9.4 per cent.

The continuous increase in disposable income and consumer expenditure has stimulated the demand in the commercial property market. The floor area of sold commercial properties has jumped at a compound annual growth rate of 2.3%, and the average price of commercial properties has increased at a compound annual growth rate of 2.2%. Reached 10952 yuan per square meter in 2019.

In terms of fund-raising purposes, the company intends to use the net proceeds from the share sale for the following purposes: about 60% will be used to finance the construction of existing projects (including the construction cost of property development projects); about 30% will be used to repay part of the existing trust loans used for the development of the company's projects; and about 10% will be used for general business operations and working capital.