QR DeCode
14 December 2016
QR DeCode Art Group Holding – Shopping Paradise in Zhengzhou Art Group Holding (AGH) has successfully turned around its results after swapping the loss-making textile business for income stable commercial properties. The company will keep looking for investment opportunities in order to expand its business scale and increase profits in the future. Switching business with successful outcome – AGH is principally engaged in the property operating business and owns two properties, namely the Jinyi Mall (Area A & B) and the Jinyi International Textile City. Both properties are situated in Zhengzhou City, Henan Province, PRC and were acquired in 2015 for rental purposes with a total GFA of about 132,119 sq. m. In addition, it has leased the building adjacent to Jinyi Mall and made it into the Jingyi Mall Area C, with a GFA of approximately 60,658 sq. m. 100% occupancy rate with diversified tenants – During FY6/16, all the commercial space in the Jinyi Mall (Area A, B & C) and Jinyi International Textile City had been leased out to over 400 tenants. The Group plans in the long term to upgrade its tenant profile by introducing more popular brands and will continue to diversify the types of tenants to meet the needs and interests of customers from different ages and backgrounds.
Improving financial position – As a result of the asset swap, AGH has improved the gross debt gearing ratio, from 98.5% in 2015 to 68.4% in 2016, which is considered to be quite healthy for a property investment company. AGH will keep a significant amount of working capital on hand in order to maintain a healthy financial position, and adequate resources are expected to be generated from its business operations. The company might resume dividend payments when the business is considered to be mature and stable.
Share Information Stock Code Quam’s Rating Last Closing (HK$) 52-week range (HK$) 3-mth ADT (HK$’mn) Market Cap. (HK$’mn) Shares outstanding (‘mn) Free float SH-HK Stock Connect SZ-HK Stock Connect
565 HK Not Rated 0.83 0.15 – 1.06 11.08 2,228.6 2685.0 57.9% X X
Substantial Shareholders Chen Jinyan Chen Dong & Lin Lin Chen Jinqing & Chen Junfang
22.25% 13.75% 6.18%
Share Price Performance
Source: Bloomberg Key Financials – FY JUN HKD’mn FY14 FY15 Revenue 493 21 Operating profit 58 (7) Net profit 15 (12) EPS (HKD) Growth DPS (HKD) BVPS (HKD)
FY16 140 94 441
0
(0)
0.168
0 1
0 0
0 0.478
56.0 0.5 n.a n.a
5.7 0.7 23.4 n.a
PER (x) 23.3 PBR (x) 0.3 EV/EBITDA (x) n.a Dividend Yield (%) 0.0 Source: Company data
Tsz Wang Poon : +852 2971 5432 : [email protected]
For important disclosures regarding Quam Research, including with respect to any issuers mentioned herein, please refer to the disclaimers at the back of the report.
Improving business environment AGH has transformed from a textile company into a property investor since 2015. The company had bought a shopping mall in each of FY15 and FY16, looking to generate a constant stream of rental income and improve the company’s cash flow. In the future, it will continue to penetrate into the property operating markets, explore other new market potentials and increase profit margin by applying strict cost control policy.
Jinyi Mall Area A & B (Owns 75% stake) In Mar 2015, AGH acquired a 75% stake in a shopping mall in Zhengzhou City, China for RMB 591.66mn. It has turned the 4-storey shopping mall with total GFA of approximately 125,188 sq. m. into Jinyi Mall Area A & B. All the commercial space in the mall had been leased out as at the end of FY16. The mall is a one-stop shopping paradise offering a wide range of services and goods to consumers and shoppers with over 160 tenants including a Wangfujing department store, a Jackie Chan Cinema, KTV, retail shops of domestic and international brands and restaurants. The rental income of Jinyi Mall Area A & B was approximately HK$115mn in FY16, accounting for about 82% of the turnover. Figure 1: Jinyi Mall (Area A)
Source: Quam Securities
Figure 2: Jinyi Mall (Area B)
Source: Quam Securities
Jinyi Mall Area C (Rented) During FY6/16, AGH entered into a leasing agreement with the developer of the adjacent building with a total GFA of 60,658 sq. m. and renamed it Jinyi Mall Area C. The lease of Jinyi Mall Area C has been extended to the end of 2017. As at the end of FY16, all the commercial space in Area C
Art Group Holding (565 HK)
2
had been leased out to over 110 tenants including a cinema, an aquarium, kids’ paradise, other retailers and restaurants. AGH is renting Area C for about RMB 15mn per year while the rental inome contributed from this mall is about HK$25mn in FY16, accounting for about 18% of the turnover. Figure 3: Jinyi Mall Area C
Source: Quam Securities
Jinyi International Textile City (Owned 164 shops) In Aug 2015, AGH acquired 164 shops with a GFA of approximately 6,931 sq. m. in a giant themed shopping mall for rental purposes. The shopping mall is named Jinyi International Textile City and shops selling textile material, accessories and products. It is located in Zhengzhou City, the PRC, with GFA of approximately 400,000 sq. m. As at the end of FY16, all shops owned by AGH had been leased out and the rental income of this mall is expected to range between RMB 3mn and RMB 4mn each year in the next 4 years. Figure 4: Jinyi International Textile City
Source: Quam Securities
Art Group Holding (565 HK)
3
Possible acquisition targets The major shareholder has personal investments in other property developments in Zhengzhou. The GFA of each project is often over 1mn sq. m. Properties for commercial use will usually be built after residential properties are completed and sold. AGH may acquire these profitable commercial properties with preferential prices in the future in order to increase the business scale of the company. Figure 5: Selected property developments owned by the major shareholder
Source: Quam Securities
Art Group Holding (565 HK)
4
Peer comparison The property investment in Zhengzhou owned by AGH is unique among Hong Kong listed companies and there is no direct comparable. Taking into consideration the property operating business, we have selected some China property investment companies listed in Hong Kong for comparison purposes. Figure 6: Peers comparison P/E
Last Price
Market Cap
Hist
Current
Next
P/B
Div Yield
Trailing 12Net mth T/O
Profit
EV / EBITDA
GPM
('mn)
('mn)
(x)
(%)
(%)
(%)
(%)
(%)
Currency
441
23.4
65.1
315.1
1365.2
-3.7
2.7
HKD
1,397 874 (318) (317)
4.9 6.8 N/A N/A
48.6 53.3 93.5 -31.1
24.9 42.7 -789.8 -354.9
93.7 (12.9) (83.2) (43.7)
14.8 3.7 -5.4 -132.9
10.2 3.3 -1.3 -4.0
CNY HKD HKD HKD
41.1
-269.3
(11.5)
Company Name
Ticker
(HK$)
(HK$'bn)
(x)
(x)
(x)
(x)
(%)
ART GROUP HOLDIN
565 HK
0.83
2.23
14.2
N/A
N/A
1.74
0.0
140
0.49 0.17 0.35 0.09
7.74 2.73 2.13 1.21
4.8 3.1 N/A N/A
5.6 N/A N/A N/A
4.5 N/A N/A N/A
0.79 0.20 0.54 18.44
4.8 2.1 0.0 0.0
6,564 2,044 77 59
3.9
5.6
4.5
4.99
1.7
Real Estate Investment Trust GEMDALE PROPERTI 535 HK LAI FUNG HLDGS 1125 HK EVERCHINA INTL 202 HK RICHLY FIELD CH 313 HK
Simple average
Source: Bloomberg, Quam Securities
Risk factors
Ability to retain existing and attract new tenants could affect the overall rental and occupancy rate of the properties;
Operation of rental investment properties might be affected by the retail and consumer markets;
Government policies on property matters;
Company Overview Three executive directors of the company are Chen Jinyan, Chen Dong and Chen Jinqing. They are brothers and hold an aggregate 42.18% of the company. Figure 7: Shareholding Structure Chen Jinyan
22.25%
Chen Dong & Lin Lin 13.75%
Chen Jinqing & Chen Junfang 6.18%
Public 57.82%
Stock Code: 565 HK
Source: Company data, HKEX, Quam Securities
Art Group Holding (565 HK)
5
Net EPS Margin Growth
ROE
ROA
Appendix: Investment properties location Figure 8: Jinyi Mall Area A, B & C
Source: PocketGamer.biz, Quam Securities
Figure 9: Jinyi International Textile City
Source: PocketGamer.biz, Quam Securities
Art Group Holding (565 HK)
6
Appendix: Financial Statements & Ratios Figure 10: Financial Statements & Ratios 2014 1,430 (1,261) 169
2015 21 (4) 18
2016 140 (49) 91
Other income and gains, net Other operating expenses Operating profit
1 (67) 103
1 (44) (26)
14 (20) 85
Finance costs Other gains/ (expenses) Profit before tax Income tax expense Profit after tax Attributable profit to shareholders Minority interest
45 9 158 36 122 122 0
33 35 43 25 (5) (12) 246
58 152 295 79 500 441 290
Income Statement (HKD mn) Revenue Cost of goods sold Gross profit
Key Ratios Debt to equity (%) Net debt to equity (%) Current ratio (x) Quick ratio (x) Interest coverage (x) Days inventory (days) Days receivable (days) Days payable (days) Cash conversion cycle (days) Ratio Analysis Growth (YoY%) Revenue EBITDA Net profit Diluted EPS Margins (%) Gross profit margin EBIT margin Net profit margin Other ratios (%) Return on average assets Return on average equity Dividend payout ratio
2014 22.34 (82.01) 4.22 3.98 na 24 30 na 41
2015 98.50 76.93 0.93 0.76 na 628 779 na 2,084
2016 68.39 64.40 0.19 0.15 na 4 23 na 13
2014
2015
2016
(32.1) (21.1) 2,458.2 2,445.7
(95.6) na na na
551.4 na na na
11.8 10.4 8.5
81.8 (32.0) (57.9)
65.1 67.2 315.1
6.0 12.4 0.0
(0.6) (1.1) 0.0
13.9 36.4 0.0
2014
2015
2016
115 0 0 0 115
114 35 2,646 0 2,794
7 64 3,017 0 3,088
17 73 1,091 52 1,233 1,347
1 7 301 69 378 3,172
0 10 62 17 90 3,177
36 234 23 292
4 365 37 405
0 367 115 482
0 9 9 301
1,009 362 1,371 1,777
701 431 1,133 1,614
Shareholders’ equity Share capital Reserves Total shareholders’ equity Minority interest Total equity
176 870 1,046 0 1,046
269 881 1,150 246 1,077
285 987 1,272 290 1,395
Cash Flow Statement (HKD'mn) Operating cash in/(out) flow Investing cash in/(out) flow Financing cash in/(out) flow Net change in cash
2014 153 39 (91) 101
2015 227 (726) 60 (440)
2016 139 (185) (193) (239)
Per Share (HKD) EPS Diluted EPS DPS BVPS
2014 0.059 0.059 0.000 0.503
2015 (0.005) (0.005) 0.000 0.443
2016 0.168 0.167 0.000 0.478
Balance Sheet (HKD mn) Non-current assets PPE Intangible assets LT investments & receivables Others Total non-current assets Current assets Inventories Account receivables Bank balances and cash Others Total current assets Total assets Current liabilities Account payables ST borrowings Others Total current liabilities Non-current liabilities LT borrowings Other non-current liabilities Total non-current liabilities Total liabilities
Source: Bloomberg
Art Group Holding (565 HK)
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Disclaimer and Risk Statement This document is published by Quam Securities Company Limited ("Quam Securities"), a licensed corporation (CE number AAC577) regulated by the Securities and Futures Commission in Hong Kong. Quam Securities is an affiliate of Quam Limited (0952.hk) and its group of companies (collectively "Quam Group"). This document is not intended for distribution to or use by, any person or entity who is a citizen or resident of any jurisdiction where such distribution or use would be contrary to applicable law or regulation within such jurisdiction. In particular but without limitation, neither this document nor any copy hereof may be taken or transmitted into Japan, Canada or the United States or distributed, directly or indirectly, into the United States or to any U.S person (within the meaning of Regulation S under the U.S. Securities Act of 1933) or general public located in Mainland China (but not including people in Hong Kong, Macau and Taiwan). This document is circulated to addresses solely and may not be reproduced or redistributed to any other person or published, in whole or in part, for any purpose. This document does not constitute an offer or a solicitation of an offer to buy or sell any securities. Any recommendation does not have regard to specific investment objectives, financial situation and particular needs of any specific addressee. Quam Securities accepts no liability whatsoever for any direct or consequential loss arising from any use of this document. The opinions and/or recommendations of this document do not take into account the recipients' own investment objectives, investment experience, financial situation and other personal circumstances. The recipients of this document shall be solely responsible for making their own independent investigation of the business, financial condition and prospects of companies referred to in this document. The research is based on information obtained from sources believed to be reliable, but Quam Securities does not make any representation or warranty as to its accuracy, completeness or correctness. This document is for informational purpose only and should not be treated as a recommendation on any particular securities, financial instrument, investment portfolio or trading strategy. Opinions and/or recommendations expressed in this document are subject to change without prior notice to all recipients. The prices of securities may move up or down, and past performance is not an indication of future performance. Investors shall consider seeking separate legal or financial advice before making investment decisions. The following analyst hereby certify that their views about the issuer and its securities discussed in this report are accurately expressed and that they have not received and will not receive direct or indirect compensation in exchange for expressing specific recommendations or views in this report: Tsz Wang POON (BIB419) and their associates declare that as of the date of the publication of this report, they do not hold any financial interest in the company.
Art Group Holding (565 HK)
8
QR DeCode Art Group Holding – Shopping Paradise in Zhengzhou Art Group Holding (AGH) has successfully turned around its results after swapping the loss-making textile business for income stable commercial properties. The company will keep looking for investment opportunities in order to expand its business scale and increase profits in the future. Switching business with successful outcome – AGH is principally engaged in the property operating business and owns two properties, namely the Jinyi Mall (Area A & B) and the Jinyi International Textile City. Both properties are situated in Zhengzhou City, Henan Province, PRC and were acquired in 2015 for rental purposes with a total GFA of about 132,119 sq. m. In addition, it has leased the building adjacent to Jinyi Mall and made it into the Jingyi Mall Area C, with a GFA of approximately 60,658 sq. m. 100% occupancy rate with diversified tenants – During FY6/16, all the commercial space in the Jinyi Mall (Area A, B & C) and Jinyi International Textile City had been leased out to over 400 tenants. The Group plans in the long term to upgrade its tenant profile by introducing more popular brands and will continue to diversify the types of tenants to meet the needs and interests of customers from different ages and backgrounds.
Improving financial position – As a result of the asset swap, AGH has improved the gross debt gearing ratio, from 98.5% in 2015 to 68.4% in 2016, which is considered to be quite healthy for a property investment company. AGH will keep a significant amount of working capital on hand in order to maintain a healthy financial position, and adequate resources are expected to be generated from its business operations. The company might resume dividend payments when the business is considered to be mature and stable.
Share Information Stock Code Quam’s Rating Last Closing (HK$) 52-week range (HK$) 3-mth ADT (HK$’mn) Market Cap. (HK$’mn) Shares outstanding (‘mn) Free float SH-HK Stock Connect SZ-HK Stock Connect
565 HK Not Rated 0.83 0.15 – 1.06 11.08 2,228.6 2685.0 57.9% X X
Substantial Shareholders Chen Jinyan Chen Dong & Lin Lin Chen Jinqing & Chen Junfang
22.25% 13.75% 6.18%
Share Price Performance
Source: Bloomberg Key Financials – FY JUN HKD’mn FY14 FY15 Revenue 493 21 Operating profit 58 (7) Net profit 15 (12) EPS (HKD) Growth DPS (HKD) BVPS (HKD)
FY16 140 94 441
0
(0)
0.168
0 1
0 0
0 0.478
56.0 0.5 n.a n.a
5.7 0.7 23.4 n.a
PER (x) 23.3 PBR (x) 0.3 EV/EBITDA (x) n.a Dividend Yield (%) 0.0 Source: Company data
Tsz Wang Poon : +852 2971 5432 : [email protected]
For important disclosures regarding Quam Research, including with respect to any issuers mentioned herein, please refer to the disclaimers at the back of the report.
Improving business environment AGH has transformed from a textile company into a property investor since 2015. The company had bought a shopping mall in each of FY15 and FY16, looking to generate a constant stream of rental income and improve the company’s cash flow. In the future, it will continue to penetrate into the property operating markets, explore other new market potentials and increase profit margin by applying strict cost control policy.
Jinyi Mall Area A & B (Owns 75% stake) In Mar 2015, AGH acquired a 75% stake in a shopping mall in Zhengzhou City, China for RMB 591.66mn. It has turned the 4-storey shopping mall with total GFA of approximately 125,188 sq. m. into Jinyi Mall Area A & B. All the commercial space in the mall had been leased out as at the end of FY16. The mall is a one-stop shopping paradise offering a wide range of services and goods to consumers and shoppers with over 160 tenants including a Wangfujing department store, a Jackie Chan Cinema, KTV, retail shops of domestic and international brands and restaurants. The rental income of Jinyi Mall Area A & B was approximately HK$115mn in FY16, accounting for about 82% of the turnover. Figure 1: Jinyi Mall (Area A)
Source: Quam Securities
Figure 2: Jinyi Mall (Area B)
Source: Quam Securities
Jinyi Mall Area C (Rented) During FY6/16, AGH entered into a leasing agreement with the developer of the adjacent building with a total GFA of 60,658 sq. m. and renamed it Jinyi Mall Area C. The lease of Jinyi Mall Area C has been extended to the end of 2017. As at the end of FY16, all the commercial space in Area C
Art Group Holding (565 HK)
2
had been leased out to over 110 tenants including a cinema, an aquarium, kids’ paradise, other retailers and restaurants. AGH is renting Area C for about RMB 15mn per year while the rental inome contributed from this mall is about HK$25mn in FY16, accounting for about 18% of the turnover. Figure 3: Jinyi Mall Area C
Source: Quam Securities
Jinyi International Textile City (Owned 164 shops) In Aug 2015, AGH acquired 164 shops with a GFA of approximately 6,931 sq. m. in a giant themed shopping mall for rental purposes. The shopping mall is named Jinyi International Textile City and shops selling textile material, accessories and products. It is located in Zhengzhou City, the PRC, with GFA of approximately 400,000 sq. m. As at the end of FY16, all shops owned by AGH had been leased out and the rental income of this mall is expected to range between RMB 3mn and RMB 4mn each year in the next 4 years. Figure 4: Jinyi International Textile City
Source: Quam Securities
Art Group Holding (565 HK)
3
Possible acquisition targets The major shareholder has personal investments in other property developments in Zhengzhou. The GFA of each project is often over 1mn sq. m. Properties for commercial use will usually be built after residential properties are completed and sold. AGH may acquire these profitable commercial properties with preferential prices in the future in order to increase the business scale of the company. Figure 5: Selected property developments owned by the major shareholder
Source: Quam Securities
Art Group Holding (565 HK)
4
Peer comparison The property investment in Zhengzhou owned by AGH is unique among Hong Kong listed companies and there is no direct comparable. Taking into consideration the property operating business, we have selected some China property investment companies listed in Hong Kong for comparison purposes. Figure 6: Peers comparison P/E
Last Price
Market Cap
Hist
Current
Next
P/B
Div Yield
Trailing 12Net mth T/O
Profit
EV / EBITDA
GPM
('mn)
('mn)
(x)
(%)
(%)
(%)
(%)
(%)
Currency
441
23.4
65.1
315.1
1365.2
-3.7
2.7
HKD
1,397 874 (318) (317)
4.9 6.8 N/A N/A
48.6 53.3 93.5 -31.1
24.9 42.7 -789.8 -354.9
93.7 (12.9) (83.2) (43.7)
14.8 3.7 -5.4 -132.9
10.2 3.3 -1.3 -4.0
CNY HKD HKD HKD
41.1
-269.3
(11.5)
Company Name
Ticker
(HK$)
(HK$'bn)
(x)
(x)
(x)
(x)
(%)
ART GROUP HOLDIN
565 HK
0.83
2.23
14.2
N/A
N/A
1.74
0.0
140
0.49 0.17 0.35 0.09
7.74 2.73 2.13 1.21
4.8 3.1 N/A N/A
5.6 N/A N/A N/A
4.5 N/A N/A N/A
0.79 0.20 0.54 18.44
4.8 2.1 0.0 0.0
6,564 2,044 77 59
3.9
5.6
4.5
4.99
1.7
Real Estate Investment Trust GEMDALE PROPERTI 535 HK LAI FUNG HLDGS 1125 HK EVERCHINA INTL 202 HK RICHLY FIELD CH 313 HK
Simple average
Source: Bloomberg, Quam Securities
Risk factors
Ability to retain existing and attract new tenants could affect the overall rental and occupancy rate of the properties;
Operation of rental investment properties might be affected by the retail and consumer markets;
Government policies on property matters;
Company Overview Three executive directors of the company are Chen Jinyan, Chen Dong and Chen Jinqing. They are brothers and hold an aggregate 42.18% of the company. Figure 7: Shareholding Structure Chen Jinyan
22.25%
Chen Dong & Lin Lin 13.75%
Chen Jinqing & Chen Junfang 6.18%
Public 57.82%
Stock Code: 565 HK
Source: Company data, HKEX, Quam Securities
Art Group Holding (565 HK)
5
Net EPS Margin Growth
ROE
ROA
Appendix: Investment properties location Figure 8: Jinyi Mall Area A, B & C
Source: PocketGamer.biz, Quam Securities
Figure 9: Jinyi International Textile City
Source: PocketGamer.biz, Quam Securities
Art Group Holding (565 HK)
6
Appendix: Financial Statements & Ratios Figure 10: Financial Statements & Ratios 2014 1,430 (1,261) 169
2015 21 (4) 18
2016 140 (49) 91
Other income and gains, net Other operating expenses Operating profit
1 (67) 103
1 (44) (26)
14 (20) 85
Finance costs Other gains/ (expenses) Profit before tax Income tax expense Profit after tax Attributable profit to shareholders Minority interest
45 9 158 36 122 122 0
33 35 43 25 (5) (12) 246
58 152 295 79 500 441 290
Income Statement (HKD mn) Revenue Cost of goods sold Gross profit
Key Ratios Debt to equity (%) Net debt to equity (%) Current ratio (x) Quick ratio (x) Interest coverage (x) Days inventory (days) Days receivable (days) Days payable (days) Cash conversion cycle (days) Ratio Analysis Growth (YoY%) Revenue EBITDA Net profit Diluted EPS Margins (%) Gross profit margin EBIT margin Net profit margin Other ratios (%) Return on average assets Return on average equity Dividend payout ratio
2014 22.34 (82.01) 4.22 3.98 na 24 30 na 41
2015 98.50 76.93 0.93 0.76 na 628 779 na 2,084
2016 68.39 64.40 0.19 0.15 na 4 23 na 13
2014
2015
2016
(32.1) (21.1) 2,458.2 2,445.7
(95.6) na na na
551.4 na na na
11.8 10.4 8.5
81.8 (32.0) (57.9)
65.1 67.2 315.1
6.0 12.4 0.0
(0.6) (1.1) 0.0
13.9 36.4 0.0
2014
2015
2016
115 0 0 0 115
114 35 2,646 0 2,794
7 64 3,017 0 3,088
17 73 1,091 52 1,233 1,347
1 7 301 69 378 3,172
0 10 62 17 90 3,177
36 234 23 292
4 365 37 405
0 367 115 482
0 9 9 301
1,009 362 1,371 1,777
701 431 1,133 1,614
Shareholders’ equity Share capital Reserves Total shareholders’ equity Minority interest Total equity
176 870 1,046 0 1,046
269 881 1,150 246 1,077
285 987 1,272 290 1,395
Cash Flow Statement (HKD'mn) Operating cash in/(out) flow Investing cash in/(out) flow Financing cash in/(out) flow Net change in cash
2014 153 39 (91) 101
2015 227 (726) 60 (440)
2016 139 (185) (193) (239)
Per Share (HKD) EPS Diluted EPS DPS BVPS
2014 0.059 0.059 0.000 0.503
2015 (0.005) (0.005) 0.000 0.443
2016 0.168 0.167 0.000 0.478
Balance Sheet (HKD mn) Non-current assets PPE Intangible assets LT investments & receivables Others Total non-current assets Current assets Inventories Account receivables Bank balances and cash Others Total current assets Total assets Current liabilities Account payables ST borrowings Others Total current liabilities Non-current liabilities LT borrowings Other non-current liabilities Total non-current liabilities Total liabilities
Source: Bloomberg
Art Group Holding (565 HK)
7
Disclaimer and Risk Statement This document is published by Quam Securities Company Limited ("Quam Securities"), a licensed corporation (CE number AAC577) regulated by the Securities and Futures Commission in Hong Kong. Quam Securities is an affiliate of Quam Limited (0952.hk) and its group of companies (collectively "Quam Group"). This document is not intended for distribution to or use by, any person or entity who is a citizen or resident of any jurisdiction where such distribution or use would be contrary to applicable law or regulation within such jurisdiction. In particular but without limitation, neither this document nor any copy hereof may be taken or transmitted into Japan, Canada or the United States or distributed, directly or indirectly, into the United States or to any U.S person (within the meaning of Regulation S under the U.S. Securities Act of 1933) or general public located in Mainland China (but not including people in Hong Kong, Macau and Taiwan). This document is circulated to addresses solely and may not be reproduced or redistributed to any other person or published, in whole or in part, for any purpose. This document does not constitute an offer or a solicitation of an offer to buy or sell any securities. Any recommendation does not have regard to specific investment objectives, financial situation and particular needs of any specific addressee. Quam Securities accepts no liability whatsoever for any direct or consequential loss arising from any use of this document. The opinions and/or recommendations of this document do not take into account the recipients' own investment objectives, investment experience, financial situation and other personal circumstances. The recipients of this document shall be solely responsible for making their own independent investigation of the business, financial condition and prospects of companies referred to in this document. The research is based on information obtained from sources believed to be reliable, but Quam Securities does not make any representation or warranty as to its accuracy, completeness or correctness. This document is for informational purpose only and should not be treated as a recommendation on any particular securities, financial instrument, investment portfolio or trading strategy. Opinions and/or recommendations expressed in this document are subject to change without prior notice to all recipients. The prices of securities may move up or down, and past performance is not an indication of future performance. Investors shall consider seeking separate legal or financial advice before making investment decisions. The following analyst hereby certify that their views about the issuer and its securities discussed in this report are accurately expressed and that they have not received and will not receive direct or indirect compensation in exchange for expressing specific recommendations or views in this report: Tsz Wang POON (BIB419) and their associates declare that as of the date of the publication of this report, they do not hold any financial interest in the company.
Art Group Holding (565 HK)
8
