Dongfang fortune plans to cash in 4 billion yuan

By the end of November 6, Dongfang fortune (300059. SZ), the first Internet company with full securities license in A-share market, had a total market value of 217 billion yuan, second only to CITIC Securities and CSCI in the securities industry. Recently, according to the data of the third quarter report of 2020 released by Dongfang fortune, the company realized a total operating revenue of 5.946 billion yuan, a year-on-year increase of 92%, and a net profit of 3.398 billion yuan, a year-on-year increase of 143.66%. At the beginning of its establishment, Dongfang fortune’s main profits came from the advertising information service income of “Dongfang fortune net”, “stock bar” and “Tiantian fund”. Today, Dongfang fortune has developed into a financial holding group: it owns securities, public and private funds, micro loans, credit investigation, fund sales, securities investment consulting and other businesses, and has built a huge wealth ecosystem. < / P > < p > with the improvement of performance and the rise of stock price, the founder of Oriental Fortune has actually experienced a sharp rise in wealth. According to the latest “Hurun rich list 2020”, the founder of Oriental Fortune’s family actually ranks 68th with 60 billion yuan of wealth, while in 2019, its wealth is 22 billion yuan, ranking 153rd, more than doubling a year. < p > < p > according to the official website of Dongfang fortune, as a one-stop Internet service platform, Dongfang fortune owns securities, fund sales, financial data, Internet advertising, futures brokerage, public funds, private equity funds, securities investment advisory and micro loans. < p > < p > founded in 2005, Dongfang fortune initially provided financial information through relevant users such as Dongfang fortune.com, Tiantian fund.com, stock bar and Dongfang blog. At that time, its main profit was advertising information service income. After accumulating a large number of users, Dongfang fortune began to realize its flow. < p > < p > in 2012, Shanghai Tiantian fund sales Co., Ltd., a subsidiary of Oriental Fortune, obtained the qualification of fund sales business and entered the field of fund sales on a commission basis. According to the data of Dongfang fortune’s half yearly report in 2020, Tiantian fund has launched only fund products, with fund sales of 568.363 billion yuan, including 289.965 billion yuan of non monetary fund sales. < p > < p > in December 2014, Dongfang fortune announced that it would use its own funds to acquire 100% of the equity of Baohua century Securities Co., Ltd. located in Hong Kong, with a transaction price of HK $13 million. Subsequently, the securities company was renamed “Oriental Fortune International Securities Co., Ltd”. In 2015, Dongfang fortune acquired 100% shares of Tibet Tongxin Securities Co., Ltd. for 4.5 billion yuan, and renamed it “Tibet Oriental Wealth Securities Co., Ltd.”. < p > < p > in July 2015, Dongfang fortune announced that it acquired% of the shares of Yixian, a third-party payment company, with RMB 250 million, becoming the second largest shareholder of the company and obtaining the license of third-party payment. < p > < p > as early as may 2015, Dongfang fortune announced that it planned to use the over raised capital of 200 million yuan to invest in the establishment of a fund management company. The business scope includes fund raising, fund sales, asset management, etc. After waiting for three years, Dongfang fortune obtained the public offering license, and the company name was determined as “Tibet Dongcai Fund Management Co., Ltd.”. < p > < p > in 2016, Dongfang fortune announced that it would jointly establish a credit reference company with its related parties at a cost of 33.5 million yuan, which is now known as “Dongfang fortune credit reference Co., Ltd.”, and then Dongfang fortune realized the wholly-owned holding of the credit reference company. < / P > < p > in addition, Oriental Fortune also extends its tentacles to the insurance industry. In April 2016, Dongfang fortune announced to enter the insurance industry, planning to set up a wholly-owned subsidiary, Shanghai Oriental Wealth Insurance Agency Co., Ltd., with its own capital of 50 million yuan. The registered capital of the company is 50 million yuan, and the proposed business scope is insurance professional agent. However, the insurance agency has been unable to settle down, and Dongfang fortune has continued to enter the insurance industry in the way of “buy and buy”. In May 2019, Dongfang fortune completed the acquisition and capital increase of 100% equity of Shanghai Zhongxin insurance brokerage Co., Ltd. with RMB 64.27 million, the company was renamed as “Dongcai insurance brokerage Co., Ltd.”. < p > < p > on November 1, the “Trial Measures for supervision and management of financial holding companies” issued by the central bank has been formally implemented, which defines financial holding group as “a limited liability company or a joint stock limited company that holds or actually controls two or more different types of financial institutions, carries out equity investment management only and does not directly engage in commercial business activities.” < p > < p > as Dongfang fortune itself is directly engaged in financial business activities, it may not be appropriate to define Oriental wealth as “Financial Holding Group”. In this regard, people related to Oriental Fortune also made clear to the reporter of China Business Daily that the company is not a financial holding company. It is undeniable that the founder of Dongfang fortune (real name: “Shen Jun”) as the earliest stock evaluator in China, has already realized the leap of social stratum and now holds a huge financial group. According to the data from Tianyan, Dongfang fortune has 26 subsidiaries with 100% holding and consolidated financial statements, involving fund sales on a commission basis, public funds, securities, third-party payment, small online loans, insurance and other financial fields. The wealth industry ecosystem established by Oriental wealth has many financial licenses. < / P > < p > with the continuous merger and acquisition of Dongfang fortune, the share price of Dongfang fortune will reach a new high in 2020. In fact, the founder’s family wealth will also rise. With a wealth of 60 billion yuan, it will be ranked 68th in the Hurun 100 rich list in 2020. *** < p > < p > on November 2, the Interim Measures for the management of network small loan business (Draft for Soliciting Opinions) was issued, which made strict provisions on the loan amount, the upper limit of leverage and the prohibition of trans provincial operation. Dongfang fortune told reporters that the company will operate legally in accordance with the relevant national regulations. Since the small loan accounts for a very low proportion in the company’s business, it has little impact on the company. < p > < p > according to the 2020 half year report of Dongfang fortune, the securities industry income of Dongfang fortune accounts for more than 60%. In essence, Dongfang fortune is still a company with securities and financial e-commerce services as its main business. Since 2020, listed securities companies have increased their financing efforts. Wind data shows that 18 securities companies have announced annual fixed increase and share allotment financing plans, with a total of 159.8 billion yuan. However, Oriental Fortune has taken a different financing path. < p > < p > on October 21, at the same time of publishing the third quarter report, Dongfang fortune also announced a 15.8 billion yuan convertible bond scheme, which will be used to supplement the working capital of the wholly-owned subsidiary Dongfang Fortune Securities, especially to accelerate the development of margin trading and other credit trading business, and expand the scale of securities investment business, so as to enhance its anti risk ability. < p > < p > on January 13, 2020, Dongfang fortune issued 7.3 billion yuan of convertible bonds, and the fund-raising was also used to supplement the working capital of Dongfang Fortune Securities. In December 2017, Oriental Wealth issued 4.6 billion yuan of convertible bonds for the first time, and the fund-raising was also used to supplement the working capital of Dongfang wealth securities. < p > < p > in the three convertible bond financing, Dongfang fortune raised 27.7 billion yuan in total, of which 24.5 billion yuan was used for the credit trading business of Dongfang Fortune Securities, accounting for more than 88%. The so-called credit trading business is actually the margin trading business, which has become one of the fast-growing businesses of Oriental Wealth securities. < p > < p > according to the operating data of the securities industry in the first half of 2020 released by the China Securities Association, the net capital of Dongfang fortune was ranked 33rd, while its interest income of margin trading ranked 19th. < / P > < p > through the implementation of convertible bonds, the total assets of Dongfang fortune have been improved rapidly. By the end of the third quarter, the total assets of Dongfang fortune were 90.117 billion yuan, an increase of 45.75% over the beginning of the period; the owner’s equity attributable to shareholders of listed companies was 31.805 billion yuan, an increase of 49.94% over the beginning of the period, and the share capital was 8.613 billion shares, an increase of 28.26% compared with the beginning of the period. < p > < p > in July 2020, Dongfang fortune announced that it planned to issue no more than 5 billion yuan of debt financing tools in the inter-bank bond market, which are intended to be used by the company and its subsidiaries to repay loans, supplement working capital, and project construction. In 2020, Dongfang fortune will get 28.1 billion yuan in three times of financing. < / P > < p > a financial practitioner told China business news that the interest rates of financing instruments in the convertible bond and inter-bank bond markets are lower, the financing costs of enterprises are reduced, and compared with the fixed increase and allotment of shares by other securities companies, convertible bonds are easier to supervise and approve. On November 4, Dongfang fortune announced that Shen Yougen (the father of Shen Jun), the person acting in concert of the company’s controlling shareholder, reduced his holding of 81.5 million shares of the company. Based on the average price of reduction, Shen Yougen cashed more than 2 billion yuan this time. < p > < p > on July 10, Dongfang fortune announced that Shen Yougen planned to reduce his holdings by no more than 161 million shares and cash in more than 4.3 billion yuan. Now Shen Yougen’s reduction plan is half done. < / P > < p > Disclaimer: the purpose of this article reprinted by china.com finance and economics is to convey more information and does not represent the views and positions of the website. The content of this paper is for reference only and does not constitute investment advice. Investors operate accordingly and bear their own risks. < p > < p > Chinanet is a national key news website under the leadership of the Information Office of the State Council and managed by China foreign language publishing and Distribution Bureau. Through 11 versions in 10 languages, the website releases information 24 hours a day, which is an important window for China to carry out international communication and information exchange.