A little digging2 Apr 2021 22:13
i decided to re-read the listing document and it is worded craftily but is all in black and white and we are probably jumping the gun.
Amazing as it seems when you re-read the below from the IPO doc 57% of what was raised went to initial costs of getting listed on HK. expensive but there you go. However the sneaky bit is they also then state there is a further additional 27.5m costs under "additional listing costs" that presumably are coming off the "so called" net proceeds.
"Total expenses in relation to the Listing, which may be subject to a material adjustment as a result of
the discretionary incentives that may be paid to the Underwriters with a maximum amount of
approximately HK$4.7 million (equivalent to approximately RMB4.3 million) (based on the mid-point of
the Offer Price), is estimated to be RMB48.4 million, representing 56.7% of the gross proceeds of
approximately HK$93.3 million (equivalent to RMB85.4 million) (based on the mid-point of the
indicative Offer Price range of HK$1.13). During the Track Record Period, we incurred Listing expenses
of RMB20.9 million, of which RMB5.1 million and RMB11.7 million was charged to our consolidated
income statements for the years ended 31 December 2018 and 2019, respectively, and we expect to incur
additional total Listing expenses of RMB27.5 million for the year ending 31 December 2020. During the
year ending 31 December 2020, RMB14.2 million is expected to be charged to our consolidated income
statements, and RMB17.4 million is expected to be recognized as a deduction in equity for the year
ending 31 December 2020.
Expenses in relation to the Listing are non-recurring in nature. Our Group’s financial performance
and results of operations for the year ending 31 December 2020 will be adversely affected by the
estimated expenses in relation to the Listing."
Then if you cross check the interims they actually state the following "
"On 14 July 2020, the Company has issued 82,600,000 shares for
its listing on the Main Board of The Stock Exchange of Hong Kong
and the net proceeds from the listing after deducting the related
issuance expenses amounted to approximately HKD25 million
(equivalent to RMB23 million)."
Therefore out of the approximately 82m HK collected we actually ended up with $25m HK. pretty ridiculous but there you go the price of moving to a new stock exchange and paying the greasy palms of brokers and consultants. I see the auditors are focusing on these stated 27.5m "additional costs" as once you knock this out this is where you get down to the real money raised of a relatively measly $25m HK. Clearly all this was stated and recorded in the IPO and interims so if anyone bothered to read the details it was clear. Therefore financially this is not a hit we were not aware of but shows. The auditors want some good explanation as to the additional costs because 70% was the cost of the move. i feel a little better that this is all documented but equally sho
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