IPO News | Zhonghe Agricultural Credit once again submitted the Hong Kong Stock Exchange Main Board's business covering more than 550 counties in 23 provinces across the country

The Zhitong Finance App learned that according to the Hong Kong Stock Exchange's disclosure on September 27, Zhonghe Agricultural Credit Co., Ltd. (Zhonghe Agricultural Credit) submitted a listing application to the main board of the Hong Kong Stock Exchange, and CICC is the sole sponsor. The company submitted its listing to the Hong Kong Stock Exchange on February 28, 2024.

According to the prospectus, Zhonghe Nongxin is a leading comprehensive agricultural aid service provider in China, focusing on the rural Chinese market. It empowers small-scale farmers and rural small and micro entrepreneurs through technology-driven comprehensive products and services: including rural inclusive credit services, agricultural production services, rural consumer goods and services, and rural clean energy services.

After nearly 30 years of deep cultivation in the rural market, the company has established an offline service network directly to the countryside and leading digital intelligence service capabilities, thus achieving outstanding results. As of June 30, 2024, the company's business covered more than 550 counties in 23 provinces across the country, rooted in more than 100,000 villages, and covered nearly 200 million rural people. As of the same day, the company relied on more than 7,200 service team members and about 127,000 village-level partners in about 550 rural local service outlets to directly reach rural users. According to Frost & Sullivan's report, the company is the largest non-traditional financial institution targeting the rural Chinese market, with a market share of about 8.6% (based on total loan balance as of December 31, 2023). According to the same source, based on total commodity transactions in 2023, the company is the sixth largest e-commerce platform for agricultural agricultural machinery and tools in China.

As a leading comprehensive agricultural aid service provider in China, the company enhances cross-selling by providing credit solutions to interested customers of agricultural production services and rural consumer goods and services divisions that have passed credit assessments to improve the cost performance ratio of inherently expensive products. Demand from such customers for agricultural production services and goods and services provided under the Rural Consumer Goods and Services Division increases their demand for rural inclusive credit services. At the same time, the company provides rural inclusive credit services to further promote their demand for agricultural production services and goods and services provided under rural consumer goods and services.

As of June 30, 2024, 84.8% of customers who purchased agricultural machinery and tools and 71.3% of customers who purchased green durable goods used the company's credit solutions to fund their purchase orders. Therefore, the company's product portfolio capabilities and product customization and service capabilities help enhance customer stickiness, reduce customer acquisition costs, promote cross-selling, and enhance user life cycle value.

On the financial side, in 2021, 2022, and 2023, for the six months ended June 30, 2024, Zhonghe Nongxin achieved total revenue of approximately 2,224 billion yuan, 2,429 billion yuan, 3.181 billion yuan, 1,482 billion yuan, and 1,920 billion yuan respectively. For the same period, the company's profit for the year was -364.38 million yuan, approximately -199 million yuan, and about 206 million yuan, respectively RMB 280 million and RMB 79.091 million.