New stock pricing | Grand-Bella Holdings received 11.37 times subscription, with a price of 0.63 Hong Kong dollars per share.

Futu News, June 29th, this Wednesday$WEILI HOLDINGS (02372.HK)$Announcement: The company issued 0.2 billion shares at a price of 0.63 Hong Kong dollars per share, with a minimum subscription of 4000 shares. It is expected to be listed on June 30th.

During the public offering stage, Grand-Bella Holdings was oversubscribed by approximately 11.37 times. The final number of shares allocated to the public offering is 20 million shares, accounting for approximately 10% of the total number of shares offered (before any exercise of oversubscription rights). A total of 6201 valid applications were received, with a 5.39% allotment rate for successful applications.

In addition, the international offering was oversubscribed, and the final number of shares offered is 0.18 billion, equivalent to approximately 90% of the total number of shares offered (before any exercise of oversubscription rights). Futu News has compiled the relevant data in the following table:

The company plans to use a net amount of 0.0903 billion Hong Kong dollars from the global sale of proceeds for the following purposes: approximately 35.4% will be used to build a two-story factory building of approximately 8200 square meters; approximately 25.9% will be used to purchase four advanced composite machines and ten automatic control systems; approximately 19.5% will be used to enhance research and development capabilities; approximately 6.4% will be used to improve the company's enterprise resource planning system and infrastructure system to enhance operational efficiency; approximately 2.9% will be used for increased marketing investment; approximately 9.9% will be used for general working capital.

The company is a cigarette packaging paper manufacturer in China with the research and development capabilities to supply customized products to customers. The company mainly supplies products to cigarette packaging manufacturers operating in various provinces of China, including Hubei Province and Henan Province. The company's products are used for manufacturing cigarette packaging for well-known tobacco brands in China.

According to the prospectus, at least 9 cigarette brands that have been rated as 'Top 15 Tobacco Brands' by the National Tobacco Monopoly Administration (the top 15 cigarette brands in terms of sales in China in 2020) use the company's products as cigarette packaging materials. According to industry reports, the company was rated as the largest cigarette packaging paper manufacturer (in terms of sales) in Hubei Province in 2020, with a market share of approximately 14.9%.

In terms of finance, the revenue of Weili Holdings for the fiscal years 2019 to 2021 were 0.313 billion, 0.318 billion, and 0.37 billion RMB respectively, with a compound growth rate of 8.72%. The net income for the same period were 34.297 million yuan, 42.171 million yuan, and 35.687 million RMB respectively, with a compound growth rate of 2.01%.

In terms of the industry, China has the largest cohort of cigarette consumers in the world, with approximately 300.6 million smokers in 2020. In the fiscal year 2021, the sales value of cigarettes in China reached 1490.3 billion yuan, and it is expected to increase to 1590 billion yuan by the fiscal year 2025.

In the Chinese cigarette sales market, the sales share of middle and high-end cigarettes is significant. In the fiscal year 2021, the sales value of middle and high-end cigarettes reached 1474.4 billion yuan, and it is expected to increase to 1586.1 billion yuan by the fiscal year 2025.

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