Let foreign companies enter Chinas securities industry, which is also conducive to the formation of a healthy competitive situation in Chinas securities industry. Analysts believe that even with the increase of external competitors, overall, it is good for the improvement of the overall business level of all industries.
The market also reacted positively. In the early morning of October 11, Rita futures closed up and South China futures closed up 7.64%.
Open ahead of schedule
According to the SFC, since January 1, 2020, the restriction on foreign capital stock ratio of futures companies will be abolished. Relevant subjects can submit administrative licensing applications to me in accordance with relevant regulations such as the Regulations on Futures Trading Management, the Regulations on the Supervision and Administration of Futures Companies and the Regulations on the Administration of Foreign Investment Futures Companies. Qualified foreign investors can hold up to 100% of the shares of futures companies. I will examine and approve it in accordance with the law and regulations.
Before that, the introduction of foreign investment in the three types of companies has gone through three stages, from being closed to being allowed to participate in shares to being allowed to hold shares.
Stock-holding futures companies become hot spots in the market
On August 30 and September 5, the listing of two futures companies, Nanhua Futures and Ruida Futures, brought futures companies into the capital market for the first time.
In addition, there are more than 20 listed companies holding or participating in A shares (excluding securities firms).
The first group of companies, such as Hongyuan Securities Futures, CITIC Securities Futures 93.47%, Northeast Securities Bohai Futures 96% and Jinlong Securities 51% through Zhongshan Securities. The introduction of stock index futures makes securities companies have the demand of holding stock futures companies in their business, which is conducive to the integration of brokerage business and the development of IB business.
The second group of companies represent Zhongjin Lingnan (100% of Gold Exchange Futures), Modern Investment (100% of Gold Exchange Futures), Xinhuangpu (100% of Huawen Futures), Zhejiang Oriental (100% of Gold Exchange Futures), and Minmetals Capital (99% of Gold Exchange Futures). The futures business of such companies has become one of the main or important industries of listed companies, such as Minmetals Capital Minmetals Exchange Futures, which contributed 112 million yuan of net profit in mid-2019.
The third group of companies, such as Luxury Family (40% of Huatai Futures), Fengyuan Biochemical (28.5% of Huaan Futures), Xinhua Jin (20.04% of Gold Recruitment Futures), etc. Such companies are also one of the hot spots in the market. First, because of the concept of futures, on the other hand, some high-quality futures companies can indeed bring more profits to listed companies. For example, Huatai Futures Co., Ltd., which was joined by the gorgeous family, reported a revenue of 886 million yuan and a net profit of more than 70 million yuan in 2018.
The Progress of Mergers and Acquisitions of Futures Companies remains to be seen
It is worth noting that as a well-known futures concept stock in the market in the medium term of China, it seems to be quite bumpy in the near future. On October 9, Chinas fourth mid-term acquisition of international futures, which lasted more than four months, ended in failure.
Chinas mid-term announcement shows that since the target assets of this major asset reorganization belong to the futures industry, although there are two futures companies listed on the stock market by IPO, there are no policy obstacles to the listing of futures companies by IPO, but the listing of futures companies through major asset reorganization still needs to comply with the relevant provisions of the Regulations on Supervision and Management of Futures Companies and the Measures on the Management of Major Asset Restructuring of Listed Companies Provisional requirements.
On May 7 this year, China announced in its mid-term announcement that the company would face major asset restructuring by issuing shares to buy 70.02% of international futures, with a price of 3.501 billion yuan. At the same time, it plans to raise no more than 1.2 billion yuan from no more than 10 specific investors. Previously, China launched three acquisitions of international futures in the medium term in 2008, 2012 and 2014.