Another tax-free listed company may appear.
On the evening of May 16, Hainan Haiqi Transportation Group Co.Ltd(603069) (” Hainan Haiqi Transportation Group Co.Ltd(603069) “, securities code Hainan Haiqi Transportation Group Co.Ltd(603069) ) announced that it was planning a major asset restructuring and planned to raise funds to acquire part or all of the equity of Hainan tourism investment tax-free Products Co., Ltd. (“Hainan tourism investment”) held by Hainan Tourism Investment Development Co., Ltd. (“Hainan tourism investment”).
Hainan Haiqi Transportation Group Co.Ltd(603069) did not disclose the details of the restructuring plan, but only said that the acquisition fund came from issuing shares to specific investors and partially paying cash. In order to avoid stock price fluctuations, trading has been suspended since the opening of the market on May 16, and the suspension is expected to be no more than 10 trading days.
“This M & A is mainly due to the reform of state-owned enterprises in Hainan Province. Hainan tourism investment has injected its high-quality asset tax-free business into listed companies.” China Merchants Securities Co.Ltd(600999) pointed out that the M & A and listing of Hainan tourism investment tax-free company will help standardize the company’s operation and enrich the company’s funds. After listing, the company will give consideration to the profit demands, which will help to expand and strengthen the tax exemption of outlying islands and realize orderly competition.
win win choice
Hainan Haiqi Transportation Group Co.Ltd(603069) and maritime travel tax-free relationship. According to the data of qixinbao, Hainan Haiqi Transportation Group Co.Ltd(603069) the major shareholder is Hainan Haiqi Investment Holding Co., Ltd., which is 90% owned by Hainan tourism investment, while hailv tax exemption is a 100% owned subsidiary of Hainan tourism investment. As a wholly state-owned enterprise, Hainan’s tourism business covers eight sectors, including tourism transportation, hotel operation, tourism business and scenic resort, with many secondary enterprises. Only Hainan Haiqi Transportation Group Co.Ltd(603069) successfully listed a shares.
Therefore, the asset restructuring is not only the reorganization of Hainan tourism investment’s resources, but also an attempt to go public in a tax-free backdoor. And it is an opportunity for both HNA and CITS to be duty-free.
Hainan Haiqi Transportation Group Co.Ltd(603069) the main business is transportation, and the annual net profit will be about 50 million yuan before the epidemic in 2019. Affected by the epidemic, Hainan Haiqi Transportation Group Co.Ltd(603069) sustained losses in the past two years. In 2020, the net profit attributable to the parent company lost about 98.04 million yuan, and in 2021, the net profit attributable to the parent company lost about 71.78 million yuan. The net profit attributable to the parent company in the first quarter of this year increased compared with the same period, but it still suffered a loss of 16.3 million yuan. It is expected that there is little possibility of turning around the loss this year. This means that Hainan Haiqi Transportation Group Co.Ltd(603069) will be marked with “ST” and face delisting risk.
The solution is to inject high-quality assets. This is the underlying reason for the asset restructuring. Hainan Haiqi Transportation Group Co.Ltd(603069) is expected to raise funds based on the concept of tax exemption to cope with the difficulties.
Under the impact of the epidemic, the development momentum of tax exemption in Hainan is still strong. According to the data of Hainan Provincial Department of finance, the tax exemption on outlying islands maintained a rapid development trend in 2021, and the sales of duty-free stores on outlying islands exceeded 60 billion yuan. Haikou Customs released statistics that in the first quarter of this year, the customs supervised 14.72 billion yuan of duty-free shopping on Hainan outlying islands, a year-on-year increase of 8.4%. Favorable consumption environment and active policy support have helped the sound development of tax exemption in Hainan, and tax-free concept stocks have attracted much attention.
In addition, at the end of April 2022, the State Council again proposed to build a number of duty-free shops in the city with Chinese characteristics, and the duty-free concept stocks grew stronger Hainan Haiqi Transportation Group Co.Ltd(603069) the news of the acquisition of the duty-free maritime travel service will undoubtedly stimulate the stock price.
Facing the competition pattern of “one super and many strong” duty-free market in Hainan, sea travel duty-free actually urgently needs new development opportunities. Throughout the enterprises with tax-free licenses for Hainan outlying islands, there are only two listed companies, China tax exemption and Wangfujing Group Co.Ltd(600859) companies. China tax exemption, as an old listed tax-free company, is the only one Wangfujing Group Co.Ltd(600859) although it won the tax-free operation license, its Chairman Shang Xiping said at the “2021 performance briefing” on April 28 that no tax-free items had been implemented. Sanya sea travel duty-free city has been built and operated, and phase II project is still under construction.
In addition, according to the Hainan news report, the duty-free sales of sea travel reached 2.7-2.8 billion yuan in 2021 and 1.5 billion yuan in the first quarter of 2022. According to China Merchants Securities Co.Ltd(600999) estimation, the duty-free market share of sea travel investment in Hainan outlying islands in 2021 was 4%, which was the second largest duty-free enterprise after China free.
If the sea travel tax exemption is successfully backdoor listed, it will avoid equity dilution and IPO review process and raise working capital for enterprise development in the shortest time. This may help it seize the first opportunity in the duty-free market in Hainan.
Guanshan long
The injection of tax-free assets is actually the wish of many Hainan Haiqi Transportation Group Co.Ltd(603069) shareholders in the past two years. On August 12, 2020, the people’s Government of Hainan Province officially approved that the sea travel tax exemption enjoys the qualification of Hainan outlying island duty-free products and operates outlying island duty-free business within the scope of Hainan Province. At that time, the tax-free concept was in the limelight. Once the news was exposed, as the only listed company under Hainan tourism investment, the parent company of duty-free travel, the Hainan Haiqi Transportation Group Co.Ltd(603069) share price immediately rose. At that time, it was rumored that Hainan Tourism Investment Association would inject tax-free assets into Hainan Haiqi Transportation Group Co.Ltd(603069) , but Hainan Haiqi Transportation Group Co.Ltd(603069) quickly responded that the company had not carried out business related to tax-free business and had not conducted any form of negotiation with relevant parties on tax-free business.
After several twists and turns, Hainan Haiqi Transportation Group Co.Ltd(603069) ‘s share price fluctuated. The share price soared five times in just 40 days, and Hainan Haiqi Transportation Group Co.Ltd(603069) also clarified several times. Then the share price continued to fall and became calm. On May 13 before the suspension, Hainan Haiqi Transportation Group Co.Ltd(603069) closed at 12 yuan / share. However, after the completion of asset restructuring, Hainan Haiqi Transportation Group Co.Ltd(603069) share price will experience a sharp fluctuation. It is unclear whether the tax-free concept will successfully highlight the encirclement or whether the capital will have another leek cutting carnival.
In 2020, Wangfujing Group Co.Ltd(600859) obtained the tax-free license, which led to a share price carnival, but it continued to decline soon. This year, it remained fluctuating at 20 yuan per share. This is far from the highest point of 78.86 yuan / share in July 2020. The tax-free license sector has brought a stock market carnival for Wangfujing Group Co.Ltd(600859) but “the song is over” and there is no actual performance. No matter how good the concept is, it is difficult to boost the stock price.
Under the multi-point outbreak of the epidemic, the development path of duty-free industry in Hainan is not always bright. According to the data of the Ministry of culture and tourism of the people’s Republic of China and the Department of tourism and culture of Hainan Province, the number of Chinese tourists during the May Day holiday decreased by about 30% year-on-year, and the number of tourists received during the holiday in Hainan Province also decreased sharply by about 55%. During the May Day holiday this year, the total tax-free sales of Hainan outlying islands were 645 million yuan, down nearly 35% from 993 million yuan last year. Many tax-free enterprises on outlying islands, including sea travel tax exemption, have always faced continuous challenges.
Huang Hongbin, a professor at the school of accounting of Tianjin University of Finance and economics, pointed out that after backdoor listing, enterprises should not only pay attention to the improvement of short-term financial performance, but also pay attention to the strategic planning and coordination ability of enterprises after backdoor listing.
According to the current development trend, there are not many business integration points between Hainan Haiqi Transportation Group Co.Ltd(603069) and maritime travel tax exemption. According to the guidance on industry classification of listed companies issued by China Securities Regulatory Commission, Hainan Haiqi Transportation Group Co.Ltd(603069) belongs to “g54 road transportation industry”. Its main businesses include automobile passenger transport, commercial development and operation of automobile yards and stations, automobile comprehensive services, etc., which is not closely related to the development direction of duty-free in Hainan. If the two sides can accurately locate the market, formulate correct strategies, coordinate development and complement each other’s advantages after asset restructuring, it will promote the long-term good development of the enterprise.
Under the dividend of the tax-free policy of Hainan outlying islands, accelerating the injection of tax-free business into listed companies seems to have become a new trend. Coincidentally, Hainan Development Holdings Nanhai Co.Ltd(002163) is also making asset restructuring similar to Hainan Haiqi Transportation Group Co.Ltd(603069) Hainan Haiqi Transportation Group Co.Ltd(603069) .
In 2020, Hainan Holding Co., Ltd. (i.e. . In January 2021, Hainan Development Holdings Nanhai Co.Ltd(002163) transferred 45% equity of Hainan Haikong duty free products Group Co., Ltd. by means of non-public agreement transfer, which is a company engaged in duty-free business on the island. Meanwhile, Hainan Development Holdings Nanhai Co.Ltd(002163) promises to inject relevant businesses and assets within three years after the completion of this non-public offering Caitong Securities Co.Ltd(601108) predicts that “the subsequent tax-free assets of Haikong will be successively injected into Hainan Development Holdings Nanhai Co.Ltd(002163) main body, Hainan Development Holdings Nanhai Co.Ltd(002163) ushers in high-quality assets, which is expected to drive performance growth.”
