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Mengjinyuan (02585.HK)

Subscription Period: November 21 to November 26, 09:30

Offer Price: HKD 12 to HKD 14.4

Entry Fee: HKD 2909 per lot of 200 shares

Joint Sponsors: CITIC Securities

Expected Listing Date: November 29

Mengjinyuan (02585.HK) inaugurated its public offering from November 21st to 26th, with the objective of globally issuing 43.957 million H shares, allocating 10% for public offering in Hong Kong and 90% for international placement. Priced between 12 to 14.4 HKD per share, in increments of 200 shares, the entry fee per lot stands at approximately 2909 HKD, with an intended fundraising target of up to 630 million HKD. The listing of Mengjinyuan is anticipated on November 29th, under the exclusive sponsorship of CITIC Securities.

Corporate Overview

Mengjinyuan Gold Jewelry Group Co., Ltd. (hereafter referred to as "Mengjinyuan"), established in 2000, stands as a prominent Chinese original brand manufacturer (OBM) within the gold jewelry sector. As of December 31, 2023, in accordance with data from the China Gold Association and Frost & Sullivan, Mengjinyuan holds the fifth position in the Chinese gold jewelry market, boasting a market share of 3.8%. Encompassing various fundamental elements of the gold jewelry industry, ranging from raw material procurement and refining, research and development, product design, manufacturing, to retail operations through a diversified sales network, Mengjinyuan emerges as one of the select few enterprises proficient in managing all critical facets of the gold jewelry industry.

Financial Summary

Drawing insights from Mengjinyuan's financial records, the company recorded revenues of 16.871 billion, 15.724 billion, 20.209 billion, and 9.98 billion RMB for the years 2021, 2022, 2023, and the initial half of 2024, respectively. Correspondingly, the net profits attributable to the company's shareholders amounted to 221 million, 181 million, 230 million, and 47.433 million RMB, indicating variances in revenue and profit trends while underlining substantial growth prospects.

The current IPO endeavor of Mengjinyuan has enticed the participation of five cornerstone investors, collectively subscribing to an amount nearing 200 million RMB. Noteworthy cornerstone investors encompass Tianjin Haitai Capital Investment Management Co., Ltd., Matrix Capital Limited, Solid Elegance International (Hong Kong) Limited, Bright Ambition International Limited, and Swift Grace (Hong Kong) Limited.

Roughly 50% of the net proceeds from the fundraising campaign are earmarked for enhancing the production facilities in Weifang, Shandong, to augment production capacity, with 34% allocated towards expanding and fortifying the franchise network, and 16% directed towards investments in information technology.

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