The six-character daily limit of Hualin Securities is not coquettish

The return on net assets of Hualin Securities from 2015 to 2017 were 39.12%, 19.03%, and 12.91%, respectively. The decline was significant, and it dropped to 4.85% in the first half of 2018. I am very satisfied with the upcoming week.

Although according to the ranking of the Hurun Report in 2018, this person in Zijin County, Heyuan, Guangdong has a net worth of 67 billion yuan, but after 16 years of waiting, it is just like the original 500 million yuan. After taking over 3.6% of Ping An Group's equity from Shenzhen Investment Management Company, he finally made a lot of money. Once again, he verified the famous saying that "time is money".

On January 17, Hualin Securities (002945.SZ), which has been around for nearly a year, finally became the first securities firm to debut A shares in 2019. As of the morning of the 25th, the stock has continuously out of six one-word daily limit, and relative to the performance of 9.22 yuan / share, the total market value of 24.894 billion yuan. Note that according to Lin's own statement, after completing the disputed equity transfer procedures in March 2013, he directly controlled 72.62% of the absolute superiority of Hualin Securities. According to the

announcement, the total amount of funds raised from the public issuance of shares is RMB 978 million, and the actual net proceeds of the public offering is RMB 921 million. It is reported that the funds raised will be used to supplement the company's capital, increase the company's working capital, expand the business scale, optimize the business structure, and improve the company's market competitiveness and anti-risk capabilities.

Of course, what the market pays more attention to is the long-standing "low-key capital tycoon" name and the unique family label of Hualin Securities, which is very different from its peers. It is reported that the company has also been called "China's first family-owned brokerage firm" due to the relative relationship between several senior executives and their actual controller and chairman Lin Li.

There is no doubt that the recent strong performance of the brokerage sector has made the newly-incorporated listed company quite "good luck." However, if it matches its performance and superimposes the background of the long-term downturn in the capital market, then Hualin Securities' future profitability is not optimistic.

"Investment Times" researcher also noticed that in the classification rating of securities companies in 2018, the company has dropped from A in 2017 to BB, which is the lowest level in the past five years.

If Lin, who once said that he would never sell Hualin Securities, finally achieved the result of maximizing investment income, then he once hoped to build a financial holding group with Hualin Securities as a platform, it is far from When it comes to "cultivating a true fruit".

rare family holdings

's strong family atmosphere really makes Hualin Securities unique.

According to the prospectus, before the IPO, the equity structure of Hualin Securities was relatively simple, that is, three legal entities held shares, of which Shenzhen Liye Group Co., Ltd. (hereinafter referred to as Liye Group) held its 1.74 billion shares. , Accounting for 71.62% of its total share capital before the issuance. Shenzhen Yijing Food and Beverage Co., Ltd. (hereinafter referred to as Yijing Food) and Shenzhen Sigma Computer Technology Co., Ltd. (hereinafter referred to as Sigma) hold 19.95% and 8.43% of its shares, respectively.

Lin Li holds 99.67% of Liye Group's equity and is the actual controller of Hualin Securities; Zhong Juqing holds 0.33% of Liye Group's equity, and Zhong Juqing and Lin Li have a mother-child relationship. Sigma is held by Lin Li's cousin Zhong Na and cousin Zhong Man, holding 86.81% and 13.19% respectively.

As for the well-known Yijing Food in Shenzhen, it was also founded by Lin Li. Anecdotal rumors claim that although the shareholders of Yijing Food are Zhang Zesheng and Zhang Yumin in the industrial and commercial information, Lin Qian is the real boss behind the scenes, and Lin Qian is Lin Li's younger brother. In the early years, Liye Group, Sigma, and Yijing Food also cross-shared each other. Around August 2002, Yijing Food was once the second largest shareholder of Sigma, and its largest shareholder was Liye Group. In 2014, Yijing Food also ranked the ninth largest shareholder of Liye Group with a capital contribution of 35 million.

In March 2018, in order to regulate the behavior of securities companies’ controlling shareholders, the China Securities Regulatory Commission began to study and draft the "Regulations on the Management of Equity of Securities Companies" (hereinafter referred to as the "Regulations") and solicit opinions. WhereOne of the terms of the securities business shock is that the net assets of the securities firm’s controlling shareholder shall not be less than RMB 100 billion; at the same time, the main business has sustained profitability and has been profitable in principle in the past five years. 100 billion yuan, the net profit of the main business should not be less than 50% of the net profit. In addition, the "Regulations" clearly require that a single non-financial enterprise actually controls the equity of a securities company not to exceed one-third.

may wish to benchmark. As of June 30, 2018, Liye Group's net assets were 15.842 billion yuan, which obviously does not meet the requirements of the above-mentioned "Regulations". In addition, its 2017 revenue was only 4.565 billion yuan, which is far from the standard of not less than 100 billion yuan in accumulated revenue from main business in the last three years of the Regulations.

Some market participants believe that this may be the reason why Hualin Securities has delayed so long from the meeting to the listing. However, since the official version of the above-mentioned "Regulations" has not been implemented so far, this has also enabled Hualin Securities to successfully break through this gap. In addition, in addition to the high degree of shareholding by family members, the senior management structure of Hualin Securities also fully reflects Lin's will. At present, Lin Li himself is the chairman of Hualin Securities, his wife Pan Ning is the vice president and chief financial officer, and his cousin Zhong Na is the chairman of the company's board of supervisors.

In history, the core business management of Hualin Securities has experienced the three eras of Junan, Guoxin, and Ping An. Especially after the former general manager of Ping An Securities Xue Rongnian passed on Hualin Securities and became chairman of the board, his strong style has made the outside world quite impressive. Side eyes. "Investment Times" researchers noticed that Xue was forced to resign in May 2013 due to the misrepresentation of Wanfu Biotech. Lin Li subsequently significantly strengthened his family's control over the company. "We have the absolute right to speak for re-establishing and perfecting Hualin's employment system." He confessed that way.

Hualin Securities also disclosed the risk of actual controller control in the prospectus: Lin Li and his wife have a significant impact on the company’s daily production and operation. Although the company has established a standardized corporate governance structure, the company’s articles of association, shareholders’ meeting, board of directors, and independent Institutional arrangements such as the director system and related-party transaction decision-making system reduce the possibility of the actual controller harming the company’s interests, but there are still actual controllers and controlling shareholders who use their holding position to improperly interfere with the company’s personnel, operation and financial decisions, thereby harming their interests Possible.

four relocations are almost solitary cases

Hualin Securities was established in 1988. At the beginning of its establishment, it was registered in Jiangmen, Guangdong Province, formerly known as Jiangmen Securities. In 2003, it was renamed Hualin Securities Co., Ltd. through capital increase and share expansion. From this time, Lin Li also began to control the brokerage. As the first domestic securities firm with a private background, Hualin Securities is already a rare case. However, the four relocations in eight years have become an “isolated case”.

In 2007, Hualin Securities moved the company to Zhuhai. At that time, the company stated, “The predecessor, Jiangmen Securities, has always been committed to the development route of gradually moving from a regional brokerage to a national brokerage. Zhuhai is one of the first special economic zones to be established, with a superior geographical location and good economic development. The image of the company across the country."

In 2009, Hualin Securities also stated that "because the company's domicile is inconsistent with the main office," it decided to move to Shenzhen.

In 2014, Hualin Securities moved to Beijing. The company said, "This will help the company take advantage of local enterprise gathering and talent attraction advantages, enhance the company's business strength, improve the company's competitiveness in the securities industry, and facilitate the company's national business layout." From 2015 to 2015, China Lin Securities moved to Lhasa, Tibet, and its company's registered address is also marked as: No. 1-1 Chagu Avenue, Liuwu New District, Duilungdeqing District, Lhasa. Some analysts believe that moving to Tibet is undoubtedly a green channel for IPOs in the western region. In addition, the company can also enjoy local tax incentives. The

prospectus disclosed that Hualin Securities enjoys tax incentives in terms of business tax and income tax. It is worth mentioning that from January 1, 2015 to December 31, 2017, the company also temporarily exempted the part of the corporate income tax payable by enterprises in the Tibet Autonomous Region that belongs to the local share. This also led to a sharp increase in the net profit of Hualin Securities attributable to its parent in 2015.

When the profit decline is in progress, even if

enjoys special tax incentives in Tibet, the net profit of Hualin Securities has continued to decline since 2015.

From 2015 to 2017, theThe company's net profit attributable to its parent was 816 million yuan, 589 million yuan and 463 million yuan, respectively, showing a downward trend year by year. In 2018, the company only achieved a net profit of 185 million yuan attributable to the parent in the first half of the year. In the prospectus, Hualin Securities predicts that its net profit attributable to its parent in 2018 will be 317 million to 344 million yuan, a range of -25.54% to -19.08% from the same period last year.

Hualin Securities once said proudly in the prospectus: “Faced with fierce market competition and cyclical changes in the capital market, the company has continuously enhanced its management level, business level, and comprehensive competitiveness, and its operating performance has achieved steady development. The return on net assets and return on net capital in 2016 are both ranked first in the securities industry. "The problem is that 2019 is not 2016, and investors are now paying more attention to the company's future development potential. In fact, the return on net assets that Hualin Securities was once proud of now seems to be unreasonable. From 2015 to 2017, this indicator was 39.12%, 19.03%, and 12.91%. In 2017, it was even lower than the rate of return before the relocation to Tibet. In the first half of 2018, it dropped to 4.85%.

"Investment Times" researcher found that the company's high return on net assets is actually derived from extremely high leverage. In 2015, its asset-liability ratio was as high as 84.40%, and its leverage was as high as 6.41 times. Although the index had dropped to 69.04% by 2018, it was still at a relatively high level in the industry. In addition, the company's return on total assets is also in a downward state. From 2015 to 2017 and the first half of 2018, they were 6.38%, 3.64%, 3.2% and 1.36%, respectively.

The classification rating of securities companies published by the China Securities Regulatory Commission has always been regarded as an important indicator for measuring the development of various businesses of securities companies. In 2018, Hualin Securities was downgraded to BB, the lowest level in the past five years. In this regard, the Hualin Securities prospectus stated that the main reasons are the tightening of supervision and the deduction of points for the company's investment banking business subject to administrative supervision measures.

It is worth noting that the 4 securities companies listed in 2018 are all A-level or above, of which China Securities (601066.SH) is AA-level, Nanjing Securities (601990.SH), Tianfeng Securities (601162.SH), Great Wall Securities (002939.SZ) are all Grade A. As of the morning of January 25, the market capitalization of the above-mentioned four securities firms was 86.786 billion yuan, 26.143 billion yuan, 39.109 billion yuan, and 33.672 billion yuan respectively, which were significantly ahead of Hualin Securities.

In December 1990, the Shenzhen Stock Exchange was established. Lin Li, who had resigned from the Shenzhen branch of the Bank of China in the following two years, completed the original accumulation by borrowing his ID card to purchase a large number of "old five shares". In January 2019, Hualin Securities listed on the Shenzhen Stock Exchange as he wished, and Lin Li also became the chairman of a listed securities company. However, under the pressure of the company's decline in profitability, the decline in ratings and the relevant "Regulations", will there be a "legend" that continues to play out? The market is watching closely.