Nanhua Futures (02691) H-share listing: scarcity creates long-term value, and globalization starts a new cycle of growth

The global financial integration process is accelerating, compounded by the continued rise in demand for cross-border risk management by Chinese enterprises, and futures companies are entering a golden window period for global layout. On December 22, Nanhua Futures (02691) officially landed on the main board of the Hong Kong Stock Exchange, marking that the company has ushered in a milestone of 20 years of deepening internationalization and the full implementation of the “A+H” dual capital platform strategy.

The Zhitong Finance App noticed that Nanhua Futures' strategic advancement received a positive response from the domestic market. A-share Nanhua Futures (603093.SH) had the highest intraday increase of 3.53% on the same day, at 19.94 yuan, showing investors' confidence in the company's long-term development. However, judging from the Hong Kong stock market environment, the recent performance of IPOs is easily influenced by external factors such as overall sentiment and liquidity preferences, and may be phased out from the company's own fundamentals, but this does not change the undertone of its core values.

With 20 years of global first-mover advantage, industry-leading technological innovation, diverse and collaborative business models, and accurate grasp of rigid requirements for cross-border risk management, Nanhua Futures's long-term growth logic is clear and stable. The empowerment of the dual capital platform will further amplify its scarce cross-border service barriers and inject strong impetus into future continuous growth, and the long-term investment value is worth looking forward to.

Scarcity barriers: Cross-border full-chain qualifications create a moat

Starting as a futures brokerage service provider in mainland China, Nanhua Futures has developed into a comprehensive global financial services platform. The company's products and services include futures brokerage in China, risk management services in China, wealth management in China, and overseas financial services, covering the futures and derivatives value chain.

As one of the first domestic futures companies to promote an internationalization strategy, Nanhua Futures's core competitiveness stems from its global service network and full-chain cross-border qualification barriers under its first-mover advantage. Since setting up overseas markets in 2006, the company has built a business layout covering the four major international financial centers in Hong Kong, Chicago, Singapore and London, covering the three major time zones in Asia, North America and Europe. It has 18 trading membership qualifications and 15 clearing memberships from mainstream global exchanges. It is one of the few domestic futures management institutions with spot delivery capabilities for overseas commodities.

The scarcity of this layout accurately matches the core needs of the real economy. As the pace of “going global” of Chinese enterprises accelerates and the joint construction of the “Belt and Road” continues to expand, the overseas business revenue of A-share listed companies reached 3.8 trillion yuan in the first half of 2024, an increase of 12.8% over the previous year. Massive Chinese enterprises faced increasingly complex price fluctuations and exchange rate risks in the fields of cross-border trade, overseas infrastructure, raw material procurement, etc., making it difficult for traditional domestic futures services to cover their global risk management needs. Relying on a domestic and overseas linked service system, Nanhua Futures can provide all-weather cross-market trading channels and customized cross-border risk management solutions, covering hedging needs in various categories such as agricultural products, industrial products, energy, and metals. As of the end of June 2025, the total equity of the company's overseas futures, securities and leveraged foreign exchange brokerage services reached HK$17.8 billion, and the AUM for overseas asset management business reached HK$3.4 billion. The customer base covered high-quality entities such as multinational enterprises and financial institutions, confirming the market recognition of its cross-border service capabilities.

The technical base provides solid support for global business. The company has customer-centered Nanhua Futures App, self-developed fifth-generation NHTD trading system, Ruihua Risk Management Business Risk Control System and other systems, which can achieve high-frequency monitoring and steady risk management. The global data center network includes more than 150 server cabinets and uses a “two locations and three centers” flexible architecture to ensure safe and efficient transactions. Combined with the company's cross-border business layout covering multiple regions, the company's technical system has formed collaborative risk management capabilities at home and abroad, providing a key guarantee for cross-market business development.

Resilience in performance growth: profit certainty is highlighted in industry differentiation

Deep collaboration between domestic and foreign businesses is the core logic behind the continuous growth of Nanhua Futures's performance. Nanhua Futures has formed a two-wheel drive pattern of “consolidating the basic market at home and expanding the growth pole overseas”. Among them, the overseas financial services sector has become the most important performance growth point for the company. Against the backdrop of increased industry differentiation, this layout highlights strong profit resilience.

In 2022 to 2024, the annual profit of Nanhua Futures increased from 246 million yuan to 458 million yuan, with a compound annual growth rate of 36.5%; net profit for the first half of 2025 reached 231 million yuan, continuing the steady growth trend. In terms of profitability, the company's weighted average return on net assets (ROE) climbed from 7.75% in 2022 to 11.71% in 2024 and 5.51% in the first half of 2025, highlighting the ability to operate capital efficiently. The asset scale expanded simultaneously. Total assets increased from RMB 34.189 billion at the end of 2022 to RMB 48.863 billion at the end of 2024, with a compound annual growth rate of 19.5%, to 46.888 billion yuan as of the end of June 2025, providing sufficient capital guarantee for business development.

Overseas business has shown strong endogenous growth momentum and has become the core engine of the company's performance growth. According to the prospectus, in 2022 to 2024, the company's overseas financial services revenue increased from 231 million yuan to 654 million yuan, with a compound annual growth rate of 68%. In the first half of 2025, revenue from overseas financial services reached 327 million yuan, continuing the steady growth trend. As can be seen, the rapid growth of overseas financial services businesses is reshaping the company's growth curve.

At the same time, the optimization of Nanhua Futures's customer structure will further consolidate the foundation for growth. The number of registered customers of the company's domestic futures brokerage business increased from 4,266 at the end of 2022 to 5089 at the end of 2024, and the number of financial institution customers increased from 1,140 to 1,770, and customer stickiness continued to increase; at the end of 2024, domestic customer equity reached 316 billion yuan, a compound annual growth rate of 28.6% over the end of 2022, far exceeding the industry's compound growth rate of 1.9%, forming a virtuous cycle of mutual empowerment between domestic and foreign businesses.

Strategic upgrade: accurate increase in fund-raising to anchor the growth of global value

The Zhitong Finance App learned that the net capital raised by Nanhua Futures from its H-share listing will focus on overseas business, and it is expected that the net amount raised will be accurately used to strengthen the capital base of the core region. Among them, 30% increased the Hong Kong business and expanded the Malaysian business, 30% invested in the UK and European markets, 20% expanded the North American business, 10% expanded the Singapore business, and the remaining 10% was used for general corporate purposes and supplementary working capital. This investment is highly compatible with the company's license advantage regions and high-potential markets in the global economy, forming a positive cycle of “qualification implementation - capital increase - business volume”.

It is worth noting that the fund-raising investment of Nanhua Futures is accurately in line with the development trend of the industry. Currently, the Chinese futures market has become the world's largest commodity futures market, covering more than 140 products in 41 industries. The correlation between futures and spot prices exceeds 90%, and the pricing benchmark role is becoming more and more prominent. Nanhua Futures' fund-raising plan aims to further broaden the depth and breadth of cross-border services. On the one hand, strengthen Hong Kong's position as a business hub in the Asia-Pacific region and enhance its radiation capacity to emerging markets such as Southeast Asia; on the other hand, it will increase the mature market layout in Europe and the US, rely on the core clearing qualifications already obtained, and obtain more exchange membership qualifications and clearing rights to provide customers with richer trading varieties and more convenient service channels. In the context of increasing industry concentration, the strengthening of capital strength will help Nanhua Futures to steadily expand its market coverage and strengthen its competitive advantage in the segment.

The construction of the “A+H” dual capital platform has also given the company a unique long-term development advantage. Compared with peers listed on a single A-share market, Nanhua Futures can rely on international financing channels in the Hong Kong stock market to attract global capital participation and optimize the shareholder structure. At the same time, the listing in the two places will help enhance the company's international popularity and lay the foundation for expanding overseas institutional clients. The H-share listing is an important step for the company to expand financing channels, accelerate the international business layout, and consolidate the “moat” of overseas business.

Conclusions

In summary, the H-share listing of Nanhua Futures is not simply capital expansion; it is also a key step forward in the company's globalization strategy. The “network+qualification+technology” triple scarcity barrier built by the company, based on 20 years of international accumulation, has shown strong operational resilience and profit certainty against the backdrop of increased industry differentiation. Demand in the cross-border risk management industry continues to grow, and supply-side scarcity further highlights the company's long-term development potential. The company's influence in the field of cross-border derivatives services is expected to gradually increase with the launch of H share fund-raising and the continuous advancement of overseas business, and the collaborative empowerment of dual capital platforms. In the process of empowering the real economy's cross-border development, the company's long-term value will be gradually released based on solid fundamentals, bringing sustainable returns to investors.