NANHUA FUTURES (HKG: 02691) made its debut on the Hong Kong Stock Exchange's main board today, completing its dual listing in both A-share and H-share markets. However, its H-share performance was weak on the first trading day. The stock opened at HKD 9.13, marking a steep 23.92% discount to its IPO price of HKD 12. During the session, it plunged further by 27.5% to HKD 8.70. Based on the opening price, investors faced a paper loss of HKD 1,435 per lot (500 shares). By the time of writing, the H-share price had slightly recovered to HKD 9.55. In contrast, its A-share (SHA: 603093) showed resilience with a low-open-high-close pattern, currently up 2.18%.
CITIC SEC (HKG: 06030), acting through its subsidiary CITIC SEC (Hong Kong) Limited, served as the sole sponsor for this listing. The underwriting syndicate also included CLSA, CMB International Capital, and BOCI Asia, among others.
According to the prospectus, NANHUA FUTURES' global offering comprised a Hong Kong public offering and an international placement. The proceeds are intended for capital replenishment, overseas business expansion, and general corporate purposes.
During the public offering phase, the company received 1.91x oversubscription, with 16.1485 million shares allocated, representing about 15% of the total offering. It received approximately 7,479 valid applications, with 6,043 accepted. The success rate for one-lot applicants was approximately 74.64%. Meanwhile, the international placement was 0.99x subscribed, with 91.5105 million shares allocated, accounting for 85% of the total offering.
As a leading player in China's futures industry and the first futures firm listed on the A-share market, NANHUA FUTURES ranked eighth by total revenue among domestic futures companies in 2024 and topped the list among non-financial-institution-backed firms. The company recently expanded its global footprint, with its U.S. subsidiary gaining approval in mid-November to become a clearing member of Nodal Clear, securing clearing privileges on two major U.S. exchanges.
Financially, the company has demonstrated steady growth, with annual net profit rising from RMB 246 million in 2022 to RMB 458 million in 2024, reflecting a compound annual growth rate of 36.5%. However, the valuation gap between its H-share IPO price and A-share market price, coupled with Hong Kong's unique valuation framework for financial stocks, likely contributed to the weak debut performance.
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