PAYMENT SERVICES, FINANCE & TELECOM play Hi Sun Technology (China) Ltd (HK: 818) expects a bottom-line surge in the just-completed half, and has no plans to re-boost its stake in the world’s No.3 electronic funds transfer point of sales (EFT-POS) terminal solutions provider.
Hi Sun issued a positive profit alert last week, saying it expected to record a “significant increase” in profit for the January-June interim periodversus a year-earlier net profit of 27.0 million hkd, primarily backed by a “sharp increase” in turnover for its payment processing solutions segment recorded in the first five months of this year of around 143.2 million hkd.
The Hong Kong listco expects to announce its unaudited interim results in August 2016.
In September 2014, Hi Sun divested of 80 million shares of PAX Global Technology Ltd (HK: 327) – the world’s No.3 EFT-POS play -- for 7.5 hkd per share, representing a discount of 9.8% against the last closing price.
After the divestment, Hi Sun’s stake in PAX was cut to 33.1% from 40.4%, with management saying at the time the decision was primarily a share price-based strategy.
Hi Sun management were a presenting firm at last week’s “Scaling New Heights 8th Asia Investment Forum 2016” in Shenzhen, with a roomful of investors eager to hear more about the Hong Kong listco’s robust first-half guidance.
“We think there’s little chance we’ll repurchase a major new stake in PAX Global anytime soon,” Hi Sun Investor Relations & Corporate Strategy Manager Mr. Vanek Song told Asia Fund Space at the Forum.
Hi Sun is strategically organized into five main operating segments, thus minimizing potential overexposure toward any one business:
(1) Payment processing solutions - principally engaged in provision of payment processing services, merchants recruiting and related products and solutions; (2) Financial solutions -- principally engaged in the provision of information system consultancy, integration and operation services and sales of information technology products to financial institutions and banks; (3) Electronic power meters and solutions - principally engaged in the manufacturing and sales of electronic power meters, data collection terminals and provision of information system consultancy services; and the sales of magnetic stripe card security decoder chips; (4) Telecommunication solutions - principally engaged in the provision of telecommunication platform operation services and operation value-added services; (5) Payment platform solutions - principally engaged in the provision of mobile payment platform operation services and operation value-added services.
Hi Sun's 12-month Hong Kong share price performance Chart: Bloomberg
Hi Sun, the only Hong Kong-listed offline bankcard acquiring services firm in China, is a leader in the segment with three payment licenses covering bank cards, internet and mobile payments, with a total of only 23 granted in the PRC.
“Offline acquiring ‘SXF’(随行付) services have been reopened to new merchants while financing and clearing value-added services are growing rapidly.
“Meanwhile, reform of the Internet finance and payments industry policy further strengthens the leading advantages of ‘SXF’,” Mr. Song said.
He added that being a leader of the domestic PRC core banking system providers and first choice for Chinese banks when expanding overseas is a key draw for potential investors.
“With financial and telecom core technology and resources to continue intensive deployment and more fully participate in online and offline payments, the industrial chain enjoys obvious synergies.”
He added that Hi Sun relied on non-bank loans and had sufficient cash with financial stability.
Hi Sun management were a presenting firm at last week’s “Scaling New Heights 8th Asia Investment Forum 2016” in Shenzhen, with a roomful of investors eager to hear more about the Hong Kong listco’s robust first-half guidance. The Forum was co-sponsored by Asia Fund Space.
Photo: Asia Fund Space
Last month, Hi Sun announced that wholly-owned subsidiary Main Access entered into a share subscription agreement with Cloopen Group Holding Ltd and two founding shareholders, namely Mr. Li Xiaoguang and Mr. Sun Changxun and other investors.
Pursuant to the agreement, Main Access has conditionally agreed to subscribe for 7.4433 million series C preferred shares at the consideration of 10 million usd.
Hi Sun Technology (China) Ltd provides business and technology consulting services and solutions. The Company delivers a range of specialized services and solutions to its banking, insurance, securities, telecommunications, and utilities clients. In addition, Hi Sun, through its subsidiaries, provides consulting and information technology outsourcing services and payment solution.
