with the sound of gongs on the Shanghai Stock Exchange, China Mobile, which has set the highest IPO fund-raising amount of A-Shares in recent 10 years, finally returned to the domestic capital market and became the “first share of red chip companies returning to the A-share main board”.
On January 5, China Mobile was officially listed on the main board of Shanghai Stock Exchange.
On the first day of listing, China Mobile’s opening price was 63 yuan, an increase of more than 9% compared with the issue price of 57.58 yuan, and then the increase fell. As of the noon closing, China Mobile’s quotation was 59.77 yuan, the increase narrowed to 3.8%, the turnover exceeded 10.9 billion yuan, and the total market value was 1.3 trillion yuan.
Due to the red chip structure, the listing preparation cycle of China Mobile is longer than China Telecom Corporation Limited(601728) , but it returns to a quickly. In mid May 2021, China Mobile announced that in order to seize the opportunity window period of expanding information services, promote the implementation of the strategy of creating a world-class “power building”, promote the transformation of digital intelligence, build a new digital intelligence ecology and stimulate new momentum of high-quality development, the company plans to apply for A-share issuance and listing. Three months later, China Mobile disclosed its A-share listing prospectus for the first time. On November 4, 2021, China Mobile’s A-share IPO was approved by the development and Examination Committee of the CSRC. After 40 days, China Mobile updated its A-share listing prospectus.
It is worth mentioning that with the listing of China Mobile on the Shanghai Stock Exchange, the three operators have officially “joined hands” in a shares.
fund raising amount or exceeding China Telecom Corporation Limited(601728)
According to the prospectus, the number of shares issued by China Mobile a is 845.7 million, accounting for about 3.97% of the total number of shares issued by China Mobile after the issuance (before the exercise of the over allotment option), all of which are new shares issued to the public without the transfer of old shares.
At the same time, China Mobile grants China International Capital Corporation Limited(601995) , Citic Securities Company Limited(600030) , China Securities Co.Ltd(601066) , Huatai United Securities, BOC International Securities and China Merchants Securities Co.Ltd(600999) 6 joint lead underwriters the over allotment option (i.e. the “green shoe” mechanism) that does not exceed 15% of the initial issued shares. If the green shoes are fully exercised, the total issued shares will be expanded to about 973 million shares, It accounts for 4.53% of the total issued shares of China Mobile after the issuance (after the over allotment option is fully exercised).
According to the offering price, the total amount of funds raised by China Mobile’s A-share IPO is expected to be 48.695 billion yuan before the over allotment option is exercised; If the over allotment option is fully exercised, the total amount of funds raised is expected to be 56.025 billion yuan, exceeding the amount raised by China Telecom Corporation Limited(601728) “return a”, becoming the largest IPO project of A-Shares in recent 10 years. In August 2021, China Telecom Corporation Limited(601728) was listed as a shares, and its fund-raising amount of 54.2 billion yuan ranked fifth among the A-share listed companies over the years. The top four were Agricultural Bank Of China Limited(601288) , Petrochina Company Limited(601857) , China Shenhua Energy Company Limited(601088) and China Construction Bank Corporation(601939) .
Or just because of this, the battle investment lineup of China Mobile this time is very luxurious, including various investors such as national investment funds, large insurance companies, state-owned enterprises and Internet companies, with a total subscription amount of up to 24.3 billion yuan.
The reporter of the international finance news noted that according to the strategic placement results disclosed by China Mobile, among the 19 strategic investors, national social security fund, national transfer fund, Guoxin Investment, national integrated circuit industry investment fund phase II, China Africa Development Fund, Chinese investment fund and other national investment platforms were allocated 141 million shares, accounting for 33.33%; Large influential central enterprises such as state grid, national energy group, CETC, FAW, SDIC and China Energy Engineering Corporation Limited(601868) were allocated 137 million shares, accounting for 32.51%; Large insurance institutions such as China Life Insurance Company Limited(601628) , The People’S Insurance Company (Group) Of China Limited(601319) , Taiping Life Insurance and China Post life insurance were allocated 113 million shares, accounting for 26.75%; In addition, Jingdong, Zhengda Group, Brunei Investment Bureau and other well-known enterprises at home and abroad and international sovereign funds also participated in the A-share issuance of China Mobile.
last year’s pre profit exceeded 100 billion
It is worth mentioning that on the eve of listing, China Mobile also announced the performance forecast for 2021.
According to the announcement, China Mobile expects the operating revenue to be about 844.877 billion yuan to 852.558 billion yuan in 2021, with a year-on-year increase of about 10% to 11%; The net profit attributable to the shareholders of the parent company was about 114.307 billion yuan to 116.464 billion yuan, with a year-on-year increase of about 6% to 8%; After deducting non recurring profits and losses, the net profit attributable to shareholders of the parent company was about 107.285 billion yuan to 109.328 billion yuan, with a year-on-year increase of about 5% to 7%.
As the first of China’s three leading communication service providers, China Mobile, founded in 1997, is also a leading global communication and information service enterprise, mainly providing a full range of communication and information services for individuals, families, government enterprises and emerging markets. Among them, the personal market mainly includes personal wireless internet access, voice, short MMS and other personal information services; The home market mainly includes home broadband, “magic Baihe”, home security, intelligent networking and other services; The government enterprise market mainly includes ICT, group special line, Internet of things, group short MMS and other services; Emerging markets focus on areas such as international business, digital content and mobile payment.
According to the prospectus, from 2018 to 2020 and the first half of 2021 (hereinafter referred to as the “reporting period”), China Mobile achieved operating revenue of 736.819 billion yuan, 745.917 billion yuan, 768.07 billion yuan and 443.647 billion yuan, with corresponding net profits of 116.869 billion yuan, 106.475 billion yuan, 108.134 billion yuan and 59.186 billion yuan respectively.
In terms of revenue composition, personal market revenue is the basic market of China Mobile. During the reporting period, it generated revenue of 508.444 billion yuan, 490.748 billion yuan, 476.948 billion yuan and 255.545 billion yuan respectively, accounting for 75.78%, 72.77%, 68.56% and 64.99% of the company’s main business revenue in each period; Followed by household market income, government enterprise market income and emerging market income.
According to the previous statement of China Mobile, the return of A-Shares this time will effectively promote the all-round development of individuals, families, government enterprises and emerging markets, comprehensively promote the transformation of digital intelligence, build a new digital intelligence ecology of open cooperation, give users the opportunity to share the company’s growth benefits and help the integrated development of digital economy and real economy.
According to the plan, China Mobile will focus on “new infrastructure, new elements and new kinetic energy” to promote the transformation of digital intelligence and build a new digital intelligence ecology, which will be used for 5g boutique network construction projects, new infrastructure construction projects of cloud resources, Gigabit smart home construction projects, smart middle platform construction projects, as well as new generation information technology R & D and digital intelligence ecology construction projects. According to the prospectus disclosed in August, the total investment amount of these projects will reach 156.9 billion yuan, and the proposed fund-raising amount will be 56 billion yuan.
From the purpose of the company’s fund-raising amount, 5g network construction will become the highlight of fund-raising and investment. According to the prospectus, the planned total investment of China Mobile 5g boutique network construction project is 98.3 billion yuan, of which the planned investment in equipment cost is 81.6 billion yuan, accounting for more than 80%. The company mentioned in the prospectus for the first disclosure of A-share listing that the amount of raised funds to be invested in the project reached 28 billion yuan, accounting for 50% of the total raised funds.
In fact, 5g network construction is also the focus of China Telecom Corporation Limited(601728) Huia’s fund-raising. In August 2021, China Telecom Corporation Limited(601728) was listed as a shares. The company plans to invest 21.4 billion yuan in 5g industrial Internet construction projects in the next three years, of which 11.4 billion yuan comes from the initial fund-raising. As for the necessity of the raised investment project, China Telecom Corporation Limited(601728) said that it mainly focused on the investment and construction of wireless network, core network, MEC, bearer network and other fields related to 5g industrial Internet, “With the continuous promotion of the new infrastructure strategy, the demand of Qianxing Baiye for realizing transformation and upgrading by using 5g technology is becoming more and more urgent. 2021-2023 is the introduction period of 5g industry application. As an important practice of cloud network integration, it will help the company achieve a leading position in the field of industrial Internet and promote the company’s strategic transformation”.
(International Finance News)
