Pan Hong: Received unanimous approval from shareholders to spin off Jiangxi unit in an IPO in HK, which if successful would be a first amongst S-Chips to do so. Pan Hong will 51 to 75% stake. To fulfil HKEx requirements that prevent a conflict of interest, the NewCo will focus on property in Jiangxi and other Chinese cities in the south while Pan Hong on property in Zhejiang and northern cities…
The group plans to enter into a non-compete agr with the NewCo which will be in effect as long as Pan Hong remains as controlling sh/h and single-largest sh/h of the NewCo. The biz under the NewCo contribute some 50-60 per cent of Pan Hong's net profit on avg…
Mgt hopes to unlock the value of the shares and to raise more funds in Hong Kong to invest in larger projects. On outlook, margins expected to improve in due to a better sales mix as the grp has sold more commercial and residential units. Grp trades at 1.3x P/B and larger peers trade in HK with P/B of avg 1.54x
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