State-Owned Jewelry-Maker Looks to Strike Gold in Shanghai Market Debut
What’s new: State-owned China National Gold Group Gold Jewelry Co. Ltd. is set to debut on the Shanghai Stock Exchange on Wednesday, aiming to raise 898 million yuan ($138.6 million).
The jewelry-maker will issue 180 million new shares at 4.99 yuan apiece in the IPO, according to its prospectus filed to the Shanghai bourse Tuesday. Over 70% of the money raised will be earmarked to launch 12 new direct-sale stores in the next two to three years. The rest will be used to replenish the company’s cash flow.
What’s the background: The company estimated its profits dipped 6.45% to 421 million yuan for 2020 despite a 36.8% year-on-year jump in profits in the first half thanks to a spike in gold prices.
The company has 2,688 franchise stores across the country, and directly operates 80. It is facing fierce competition from domestic players as well as brands from Hong Kong like Chow Tai Fook Jewelry Group Ltd. and Lao Feng Xiang Co. Ltd.
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