Shenzhen Business Daily Reading Client Reporter Ma Qiang
According to an announcement by SAIC Motor (600104) on the evening of April 7, MGI, the company's Indian subsidiary in the second largest in the Indian new energy vehicle market, plans to introduce local investment, and the related transaction is expected to increase SAIC's net profit by 50~7 billion yuan.
SAIC Motor issued an announcement on the equity transfer and capital increase and share expansion of its subsidiaries tonight. According to the announcement, the company's holding subsidiary, MG Motor India Pvt.Ltd. (hereinafter referred to as MGI), intends to introduce investors such as JSW Ventures Singapore Pte.Limited (hereinafter referred to as JSW Singapore) through equity transfer and capital increase.
According to the announcement, in order to further promote the company's international business strategy, seize the opportunity of the rapid development of the Indian market, continue to increase the share of the MG brand in the Indian market, and effectively prevent business risks, the company's holding subsidiary MGI plans to introduce local investors in India to create more favorable conditions for sustainable and healthy development by giving full play to synergies.
Among them, JSW Singapore subscribed for 1.012 billion shares of MGI held by SAIC Motor Hong Kong Investment Co., Ltd., a subsidiary of the company, for INR 26.51 billion (approximately RMB 2.256 billion), and subscribed for 354 million additional shares issued by MGI for INR 9.26 billion (about RMB 788 million), with a total shareholding ratio of 35% after the completion of the transaction;
IndoEdge India Fund (hereinafter referred to as IIF) subscribed for an additional 312 million shares issued by MGI for INR 8.18 billion (approximately RMB 696 million), with a shareholding ratio of 8% after the completion of the transaction;
The dealer trust subscribed for 117 million additional shares issued by MGI for INR 3.07 billion (approximately RMB 261 million), with a shareholding ratio of 3% after the completion of the transaction;
The ESOP subscribed for an additional 195 million shares of MGI for INR 5.11 billion (approximately RMB 435 million), with a shareholding ratio of 5% after the completion of the transaction.
Regarding MGI, according to the announcement, MGI was established in February 2017 and is jointly funded by SAIC Motor Hong Kong Investment Co., Ltd. (hereinafter referred to as SAIC Hong Kong) and SAIC International Trade Co., Ltd. (hereinafter referred to as SAIC International), a wholly-owned subsidiary of the company, of which SAIC Hong Kong holds 99.99% of the shares and SAIC International holds 1 share. MGI has its registered address in Gurgaon, Delhi, India, with a registered capital of INR 3,275 crore and a paid-up capital of INR 2,925 crore. MGI's first model went on sale in June 2019, and with the gradual enrichment of the product line, the company's sales have increased year by year, from 16,528 units in 2019 to 62,010 units in 2023, ranking 8th in the Indian market, of which new energy vehicles rank second in the market.
The announcement also provides an overview of local investors in India:
1. JSW Group is an Indian multinational giant, headquartered in Mumbai, listed on the Indian Stock Exchange, and a subsidiary of O.P. Jindal Group. JSW Singapore was established specifically for this transaction, registered in Singapore, and its parent company is JSW International Tradecorp Pte.Ltd, established in 2013 with a registered capital of US$20.4 million, mainly engaged in the import and export of metals and minerals, and as of the end of September 2023, the net assets were US$260 million.
2.IIF was established in 2022 as a fund registered on the Stock Exchange of India and has raised $220 million so far.
3. The dealer trust is established by qualified dealers, etc., and the dealer trust subscribes for MGI's shares.
4. The Employee Stock Ownership Plan is used to motivate MGI employees.
According to the announcement, as of the disclosure date of this announcement, JSW Singapore has fully paid the transfer price and capital increase, and the remaining capital increase and share increase have been implemented. Following the signing of the agreement, the closing will be subject to the completion of the relevant conditions precedent, including, inter alia, the completion of the approval of the Competition Commission of India (CCI) for both JSW Singapore and the IIF and the necessary approvals from SASAC and other regulators (as the case may be) in relation to the transaction.
As for the impact of the above matters on the company, the announcement introduced that after the completion of the share transfer and capital increase, the company will use the equity method to account for MGI. Based on the fair value of MGI's equity, it is expected to increase the company's net profit by 5 billion to 7 billion yuan, which is subject to the audit results of the company's annual report auditor.
The announcement also reminded that as of the disclosure date of this announcement, MGI still has $46.67 million of shareholder loans outstanding, and plans to repay the amount through overseas commercial bank loans. This transaction is still in the process of implementation, please pay attention to the investment risks.
The reporter noted that the official website of SAIC Motor also disclosed the above news, and the relevant article said that in 2017, SAIC Motor wholly established MG India, with a paid-in capital of 29.2 billion rupees, and this time it has received 26.5 billion rupees paid by JSW to purchase 26% of the equity of MG India, and recovered most of the investment; After the completion of the premium transfer and capital increase, SAIC will retain a 49% stake in MG India and a higher percentage of voting rights.
In the secondary market, SAIC Motor Group was uneventful today, closing at 15.35 yuan per share, up 390.%, with the latest total market value of 177.7 billion yuan.
The reporter noticed in the SAIC Oriental Fortune Internet stock bar that most netizens in the stock bar expressed surprise at the good news released by SAIC, and some netizens said that Tesla began to invest heavily in India, and SAIC Motor took the lead in the layout! SAIC Motor accounted for 49% of the control and recovered the investment cost and made a net profit of 300 million yuan; more netizens are optimistic about the expectation: it is going to rise sharply?
Reviewer: Wang Bei