Rebirth 1990: I have three golden fingers

After the technology exhibition, Fang Bai prepared for the listing of Hualian Supermarket Company in Hong Kong City.

There are significant differences between domestic listings and Hong Kong listings in terms of regulatory agencies, listing standards, capital market investors, liquidity, financial report disclosures, legal systems, cross-border transaction mechanisms, price-earnings ratios, raised funds, and tax costs.

If a company listed on the Mainland A-share market wants to be listed on the main board more than ten years later, it needs to meet the requirements of "three years of continuous profits, two years of continuous dividends, and a net profit of 30 million yuan in the most recent year."

The current requirements for net profit are much lower. In this year, a net profit of 30 million yuan is too scary.

Anyway, these days, there are a lot of rules for going public, but it’s not that easy to go public. Fang Bai doesn’t want to bother with it at all, it’s too troublesome.

Moreover, it is still the period of stock market crash.

From February 1993 to July 1994, the Shanghai Composite Index fell from 1553 points to 325 points, which lasted 18 months, with the largest drop reaching 79%!

After all, the domestic stock market is still in chaos.

Fang Bai didn't want to throw the blue-chip stock of Hualian Supermarket into the whirlpool.

In the Hong Kong city market, companies are required to meet the basic conditions for listing, such as having a stable business model, stable financial performance, and a good governance structure, and can only be listed after passing the review of the audit committee.

At present, the situation of Hualian Supermarket also meets the listing requirements of Hong Kong stocks.

In terms of capital market investors, the mainland A-share market is mainly dominated by institutional investors and retail investors, with institutional investors occupying a dominant position.

The Hong Kong city market focuses more on attracting international capital, so the proportion of institutional investors and foreign investors is relatively high, while retail investors are relatively few.

If nothing else, given the circumstances of this era, it is extremely difficult for domestic retail investors to go to Hong Kong to buy stocks, and just opening an account is very difficult.

More than ten years later, although it is a little more troublesome, the account opening operation is much easier.

Fang Bai remembers that in 2010, a certain bank invited people to open an account for Hong Kong stock trading. After the account was opened, it was sent directly to the mailbox for acceptance. The funds were first transferred to a certain bank, and then the bank settled through its branch in Hong Kong City.

At that time, buying Hong Kong stocks was done through entrustment, which was not as convenient as when there was an APP later.

In terms of price-to-earnings ratio and funds raised, the price-to-earnings ratio of the mainland stock market is relatively high, and the amount of funds raised at one time is large;

The price-to-earnings ratio of the Hong Kong stock market is in line with international standards, and the amount of funds raised is larger, but less than that of the mainland.

The P/E ratio calculation method is slightly different, mainly based on the profit growth rate in the past three years and the estimated next three years, and then comprehensively evaluating the PE situation of listed companies in the same industry.

In terms of tax costs, Hong Kong City has a simple tax system and low tax rates, so the tax costs are relatively lower than those listed on the mainland.

In general, it cannot be said that Hong Kong City's listing is necessarily good, but it depends on whether it is suitable and the ultimate goal is to ensure the success of the listing.

Hualian Supermarket's influence in the country is indeed not very good, but it is backed by Fangbai.

If it is listed in China, domestic retail investors may not recognize Hualian Supermarket, and it will be more disadvantageous to be listed in China, where retail investors occupy a larger position.

In Hong Kong City, the proportion of institutional investors and foreign investors is higher, and more attention is paid to the situation of major shareholders. In fact, it is investment, which is relatively mature at present.

Therefore, Fang Bai first took action and used his personal network resources to invite Wall Street institutions to come to China for Series A and Series B financing, so that Hualian Supermarket would have some international content. In fact, it would be a cloak that would attract the attention of investment institutions in Hong Kong City. Hualian Supermarket.

When the time is almost up, you can prepare for the IPO.

As for the angel round, it is not necessary. Fang Bai invested 300,000 yuan that year, but what is the difference between it and the angel round.

Going through multiple rounds of financing, rather than just one time, is actually a time lag. The company has time to develop, allowing the company's value to rise even higher.

Two days later,

Fang Bai appeared on the Jiaotong University campus.

He has not been to school since the beginning of school. There are too many things going on.

I visited the leaders of the lower school and the college, and then met with the classmates in the lower school.

At the end of last semester, the number of Hualian Supermarkets in operation reached 80, and now there are 90, which is close to Fang Bai's target of 100 stores to allocate shares.

Fang Bai said that when one hundred stores are completed and normal operations are guaranteed, he will reward each student with 0.6% of the original shares. Currently, 0.2% has been awarded. These shares will not be diluted before the B round of financing.

His arrival was warmly welcomed by the students, who seemed to have endless things to say.

Fang Bai looked at the students gathered around him, and he was happy for them all with smiles on their faces, and said: "After some time, I will invite international investment institutions to conduct an in-depth inspection of Hualian Supermarket, and are actively preparing for Series A financing to strive for We will be listed in Hong Kong City this year, so everyone should work hard.”

Fang Bai's words caused a moment of silence in the classroom. The students were dumbfounded by the sudden news and fell into shock.

Is Hualian Supermarket looking for financing?

Are you ready to go public?

Soon, everyone began to recover from the shock, with surprise and excitement on their faces.

"Squad leader, do you need us to make any preparations?"

All along, since Fang Bai said he was preparing to go public, everyone has been learning about the listing and discussed it internally many times.

Therefore, they are not novices, but they still know something.

Fang Bai said easily: "For the normal operation of the store, the financial affairs must be clear. Let the management staff prepare it and pay an accounting firm to help sort it out."

A classmate asked out of curiosity: "Boss, how much is the valuation?"

Fang Boluo thought about it and said: "Valuation will be affected by many factors, such as the supermarket's geographical location, market position, brand influence, business model, founder, etc., which will all have an impact on valuation.

Hualian Supermarket is the only supermarket on campus. There will be at most one competitor in the future, and the market price of land is high.

In addition, the valuation also needs to consider the supermarket's future growth and profitability. If the supermarket has good growth and stable profitability, its valuation may be higher.

The annual profit growth rate has a very big impact. If you suffer losses for consecutive years, you are not expected to make a profit in the next few years. Then it will only be calculated based on net assets, which will be one or two times.

If it makes profits every year, the annual profit growth rate in the past and next three years will be around 20%, and the PE will be around 20 times. It may also be ridiculously overestimated.

If the growth rate in the past three years and the expected three years in the next three years is more than 30%, the PE is mostly, but generally it will not exceed 50. "

"Oh, boss, we don't understand these theories, so just give us a rough estimate, so that everyone can open their eyes and have fun." Wang Yifei sounded a little confused. I guess many students are like this, so let's just forget about it.

His words made the whole class burst into laughter, and they also wanted to know the specific value.

Fang Bai pondered. Last year, Hualian Supermarket Company had a total turnover of about 100 million yuan, a gross profit of about 35 million yuan, and an after-tax profit of 30 million yuan.

The A round of financing will not be until April or May. By then, the number of stores in operation will reach 95. In the past 12 months, the after-tax profit may have been about 40 million yuan.

According to Hualian Supermarket's high profit margin and annual profit growth, the PE value is relatively large.

In fact, what Fang Bai didn't say is that his personal influence is very large, mainly because he makes whatever he does. Even if the company starts up and doesn't make a penny, the company is worth at least 500 million.

The situation of Hualian Supermarket is quite special. In the past three years, the annual profit growth has been more than 100%.

This year, the after-tax profit may reach 60 million yuan, and next year it will definitely exceed 100 million yuan. The annual profit growth will still exceed 100%;

Fang Bai predicts that when the number of stores reaches 400, the supermarket's profit growth will decrease, but then Internet cafes will begin.

Therefore, in three years' time, the annual profit may reach more than 200 million yuan. With the investment in Internet cafes, Hualian Supermarket's profit growth rate will continue to grow.

Fangbai's valuation is 1.5 billion to 2 billion yuan, which is relatively reasonable.

Investors value growth after listing rather than profit dividends.

If we rely on profit dividends to cover the investment cost, it will take many years.

So he said: "If it develops to 100 stores, the pre-round A investment valuation will be between 1.5 billion and 2 billion yuan. Your shares will not be diluted before the B round of financing.

Hualian Supermarket should develop to the goals I set. I will allocate shares again as promised before, and everyone will receive a total of 0.6% of the shares! "

The problem of share dilution is easy to solve. In the final analysis, it is better to compensate Fang Bai from the shares he holds. The final share ratio that investors want and how Fang Bai is compensated have little to do with them.

"Wow, my God, more than 1.5 billion yuan!"

The students couldn't help but be shocked and began to calculate how much the shares they had were worth.

If the valuation is 1.5 billion yuan, then,

0.2%=3 million yuan!

Did they suddenly become millionaires?

If we continue to reward, it will be 9 million yuan? !

Nearly a multi-millionaire!

Fang Bai chatted for a while and then left, but after he left, the students in Class 3 of Mechanical Engineering could not restrain their inner ecstasy.

Not long after, other students in the School of Mechanical and Electrical Engineering also knew about it, and soon the news spread to other departments, who were all shocked.

Hualian Supermarket Company is preparing to be listed on the Hong Kong stock market!

The students in Class 3 of Mechanical Engineering are all close to multi-millionaires.

When the time comes to go public, you can cash out and you will be a veritable multimillionaire.

Overnight, the students in Class 3 of Mechanical Engineering became popular.

Qin Xue, the counselor of Mechanical Class 3, felt a little disappointed when she heard the news. She refused when Fang Bai asked her to participate.

Just because of her status as a counselor, she was embarrassed to hang out with students.

If only I had been thicker-skinned back then, my future life trajectory would have been really different.

But think about it, forget it, it's not your own, and there's no point in being greedy. It was Fang Bai who gave her face in the first place. Considering her identity, maybe it was just a joke.

Just two days later, students from various universities in Shanghai knew about this situation and were shocked and envious.

The local media learned about the news and conducted interviews and reports, saying that Hualian Supermarket Company was preparing for Series A financing and preparing to be listed on the Hong Kong stock market.

Some peers, as well as some senior executives of listed companies, feel that Fang Bai is a bit boastful and may be worth so much money. The problem is that he can attract institutional financing and be listed on the market.

If it cannot be listed and cashed out, it will be useless. (End of chapter)