Reborn in Hong Kong as a Tycoon

Chapter 302 Hutchison's Reasonable Market Value

The acquisition entrusted to Goldman Sachs is still in progress and not completed.

Haruko Mori and Vivien Kelly lead the formation of the Golden Fleece, with assistance from Isabella and Bill Harveys.

For the time being, there is no important matter for Lin Baicheng to deal with in the United States, and there is something wrong with Xiangjiang, so Lin Baicheng took a plane back to Xiangjiang on the afternoon of November 11.

With the time difference and more than ten hours of flying, Lin Baicheng returned to Xiangjiang after [-] o'clock in the evening of the second day.

On the morning of the 15th the next day, Lin Baicheng went to Hutchison Whampoa.

Lin Baicheng called Wei Li, Cheng Yufeng, Xia Boyin and Wei Peter to his office.

"How about it, have you found out whose funds are shorting Hutchison Whampoa these two days?"

Lin Baicheng asked aloud that the reason why he came back to Xiangjiang this time was because Wei Li and Cheng Yufeng reported to him that there was a fund shorting Hutchison Whampoa. Lin Baicheng, who holds almost half of the shares in Hutchison Whampoa, will of course come back .

When the time entered November, not only did the international gold price plummet, Hong Kong’s Hang Seng Index experienced a greater decline after the previous rebound, and the low of 602 points adjusted last time was already broken. There are about 520 points left.

More importantly, there is no end in sight, and the Hang Seng Index may continue to fall, and the position of 500 points may not be able to support it.

In the case of the Hang Seng Index plummeting, of course Hutchison Whampoa could not be spared, and the stock price had broken through 60 Hong Kong dollars before, and it had already fallen below it again.Not only that, the stock price also fell below the key price of 50 Hong Kong dollars a few days ago, and the total market value of Hutchison Whampoa fell below 200 billion Hong Kong dollars.

If the stock price of Hutchison Whampoa is adjusted and dropped normally, Lin Baicheng will not pay attention to it. Anyway, he will not sell the stock no matter how it falls, but if someone is short-selling, it will be different.

Although no matter how short-sellers short Hutchison Whampoa's stock price, as long as Hutchison Whampoa operates normally, the company's stock price will rise back sooner or later, and Lin Baicheng's interests will naturally not be affected.However, the other party knows that Hutchison Whampoa is a company controlled by him, but they sell short without even informing them, completely ignoring him. The company made money by short selling.

Therefore, Lin Baicheng returned to Xiangjiang and decided to take certain countermeasures.

"It's been checked."

Wei Li replied aloud: "The other party basically didn't hide much, so we found it out easily. The funds came from Singapore and Malaysia. We don't know who the funds belong to yet. The other party borrowed securities from HSBC. , Borrow stocks to sell short."

"Funds from Singapore and Malaysia?"

Lin Baicheng frowned slightly. He was not very familiar with these two Southeast Asian countries, but he was not unfamiliar either. However, he couldn't figure out who's funds were shorting now, and there was no need to think about it.

"HSBC is also a major shareholder of our Hutchison Whampoa. It is really possible to lend out Hutchison's stock to others for short selling."

Wei Li immediately explained: "Mr. Lin, HSBC is a bank, and margin financing and securities lending is HSBC's business. Not to mention our Hutchison Whampoa stocks, even HSBC's own stocks, as long as someone is willing to short, HSBC will still not mind. Lend stock."

Lin Baicheng raised his eyebrows: "HSBC holds 15% of Hutchison Whampoa's shares. Could it be that HSBC is just watching Hutchison's stock price drop, and the value of their shares keeps depreciating?"

Wei Li replied: "I have already contacted Shen Congee, the top class of HSBC, and Shen Congee said that everything will be under your arrangement, Mr. Lin, and HSBC will advance and retreat with you."

"Hopefully he'll be able to deliver on that when the time comes."

Lin Baicheng snorted, felt a little relieved, and changed the subject: "Yesterday, Hutchison's closing price was 44.6 Hong Kong dollars. How much Hong Kong dollar do you think is a reasonable range for Hutchison's stock price, neither overvalued nor undervalued?"

"this one"

Wei Li and the others immediately thought about it.

"Everyone, think about it."

Lin Baicheng didn't urge him either, but instead discussed with them.

Before Lin Baicheng acquired Hutchison Whampoa, Hutchison Whampoa's net assets were less than one billion Hong Kong dollars.That is more than 13 billion Hong Kong dollars in liabilities, 21 billion Hong Kong dollars in assets, and about [-] billion Hong Kong dollars in net assets after the two phases are offset.

After Lin Baicheng took over Hutchison Whampoa, he brought two major changes to Hutchison Whampoa.One time, Hutchison Whampoa participated in the long-selling of its own company's stocks, and made a profit of 3.1 million Hong Kong dollars and 1000 million shares of stocks; the other time was a profit of up to 18 billion Hong Kong dollars brought by investing in long gold futures.

Adding up the two times, after Lin Baicheng took over Hutchison Whampoa, he brought more than 21 billion Hong Kong dollars in profits and 1000 million company shares to Hutchison. Although some of the 1000 million shares have been used for equity incentives, and there will be incentive plans in the future, they can also be counted in the net assets now, and the value of these shares is about 4 million Hong Kong dollars.

With the sale of a large number of non-performing assets of Hutchison Whampoa and the rise in land prices and housing prices this year, Hutchison Whampoa's net assets have increased again, and now it has exceeded 35 billion Hong Kong dollars.

Based on the stock price of Hutchison when it exceeded 60 Hong Kong dollars, its total market value exceeded 240 billion Hong Kong dollars, and its price-to-book ratio reached nearly 7 times. This price-to-book ratio is indeed a bit high.Generally speaking, the stock price is about 3 times the net assets, that is, the price-to-book ratio of 3 times is relatively normal.

Of course, this is the general case.If a company develops quite well, and its annual operating income and profits increase by a considerable margin, then this company is certainly worth holding by the majority of shareholders. It is quite normal for the stock price to be overvalued. The net rate will naturally be high.

Just like the previous Hutchison Whampoa, many investors are optimistic about Hutchison Whampoa because of the huge profits from investment, so the stock price keeps rising, both in terms of price-earnings ratio and price-to-book ratio.

Now if it is considered a normal and reasonable valuation, of course it cannot be overestimated.

After discussion, Lin Baicheng and the others believe that the reasonable market value of Hutchison Whampoa is between 120 billion and 150 billion Hong Kong dollars. After the stock price is almost lower than 40 Hong Kong dollars, it will reach the range of the company's reasonable market value.

Of course, this is because executives such as Lin Baicheng and Wei Li have full confidence in the future development of their company, so they think that this range is a reasonable valuation. Others will definitely have different ideas from them, and the range of reasonable valuation will naturally vary. same.

However, what other people think has nothing to do with Lin Baicheng and the others. It is still very important to determine the reasonable valuation range of the company's stock price, because only when a reasonable valuation is determined can he determine when to fight back.

If the short-seller can stop before the stock price falls below the reasonable market value range, then the other party has the ability, and the money will be made by the other party, otherwise Lin Baicheng will face a counterattack.

Before that, Lin Baicheng was actually not easy to do anything, because he held almost half of the company's shares, and there was no way to increase his shareholding unless he wanted to fully acquire Hutchison Whampoa.

(End of this chapter)