New net fi­nance firm nears profit

China Daily (Hong Kong) - - BUSINESS - By LIN WENJIE in Hong Kong cher­rylin@chi­nadai­lyhk.com

A one-year-old in­ter­net fi­nance firm from the sta­ble of Green­land Group, a Chi­nese main­land de­vel­oper, is on the verge of full-year “pos­i­tive profit”.

That will make the main­land’s prop­erty mar­ket sit up and take no­tice as its profit mar­gins have grad­u­ally de­creased af­ter the last home price boom.

The Green­land arm’s im­mi­nent profit will also likely vin­di­cate main­land de­vel­op­ers who have been ex­pand­ing into the in­ter­net fi­nance sec­tor in search of new mar­ket op­por­tu­ni­ties.

Green­land Fi­nan­cial In­for­ma­tion Ser­vices is the sub­sidiary of Green­land Hong Kong, the listed unit of Green­land Group. Green­land HK CEO Chen JunIt said the in­ter­net fi­nance arm was es­tab­lished last year, in line with the group’s “real es­tate plus in­ter­net service” strat­egy, which em­pha­sizes shift­ing from an as­set-heavy model to an as­set­light model.

Land de­vel­op­ment is tra­di­tion­ally an as­set-heavy busi­ness, for the de­vel­op­ers need to buy the land be­fore de­vel­op­ing projects, which means they rely heav­ily on the com­pany’s own cap­i­tal.

As­set-light model refers to those in­ter­net fi­nance busi­nesses where rel­a­tively few cap­i­tal as­sets are re­quired com­pared with their op­er­a­tions. The as­set-light model can lower profit volatil­ity, pro­vide greater flex­i­bil­ity, and higher cost sav­ings com­pared with the as­set-heavy one.

Green­land Fi­nan­cial has formed three main busi­ness sec­tors: one, an on­line wealth man­age­ment plat­form, pro­vid­ing var­i­ous in­vest­ment prod­ucts for all users; two, pro­fes­sional as­sets al­lo­ca­tion and wealth man­age­ment ser­vices for mid­dle-class clients; and three, a cloud plat­form to pro­vide in­ter­net tech­nol­ogy and data anal­y­sis ser­vices.

With more than 500,000 reg­is­tered users, the wealth man­age­ment plat­form has seen its trans­ac­tion vol­ume ap­proach­ing 20 bil­lion yuan ($2.94 bil­lion).

Green­land Fi­nan­cial man­ages more than 5 bil­lion yuan in as­sets and sells mostly bond-type real es­tate wealth man­age­ment prod­ucts.

“Although the com­pany is only one year old, we are go­ing to post pos­i­tive prof­its at the end of this fis­cal year, which is rare among fi­nan­cial ser­vices com­pa­nies,” said Yang Xiaodong, pres­i­dent of Green­land Fi­nan­cial.

“Backed by Green­land Group’s enor­mous as­sets and a cus­tomer base of 15 mil­lion clients, the com­pany’s rev­enue and profit will dou­ble each year over the next two to three years. I am con­fi­dent about that. And I hope af­ter three years, the com­pany will seek list­ing on the cap­i­tal mar­ket.”

Steven Jia Fei, vice-pres­i­dent of Green­land Fi­nan­cial, said the com­pany will fo­cus on data anal­y­sis ser­vices next year and strengthen pre­ci­sion ad­ver­tis­ing ser­vices to tar­get po­ten­tial cus­tomers.

Green­land Fi­nan­cial has also signed co­op­er­a­tion agree­ments with Guangxi Rail­way In­vest­ment Group and China Cinda As­set Man­age­ment to in­vest in main­land real es­tate projects.

RONG / FOR CHINA DAILY JIN

Green­land Fi­nan­cial ex­hibits at an expo in Shang­hai,

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