Xin Lang Cai Jing·2026-02-10 03:35Core Viewpoint - Huatai Securities plans to issue HKD 10 billion convertible bonds, which could significantly dilute its H-share equity, with a potential increase of approximately 29.53% in the number of H-shares if fully converted, indicating a substantial dilution effect compared to recent issuances by other firms like GF Securities [1][2][16]. Debt and Financial Pressure - As of September 30, 2025, Huatai Securities had a short-term interest-bearing debt of CNY 333.48 billion, accounting for 78.77% of its total interest-bearing debt, indicating significant short-term repayment pressure [1][7][19]. - The company has been actively issuing bonds, with a total of CNY 950 billion registered and issued in January 2026 alone, reflecting its urgent need for liquidity [6][19]. - Huatai Securities' bond financing accounted for 45.29% of its interest-bearing debt as of the first three quarters of 2025, ranking second in the industry for bond liabilities [20]. IPO Project Reserve - As of February 8, 2026, Huatai's investment banking subsidiary, Huatai United, had 15 A-share IPO projects in reserve, ranking fifth in the industry but significantly behind the top firms, with the leading firm having 44 projects [10][21][24]. - The withdrawal of two A-share IPO projects in January 2026 represented 50% of the total market withdrawals for that month, highlighting challenges in maintaining a robust IPO pipeline [9][21]. International Business and Revenue - Huatai Securities expects to raise approximately HKD 99.25 billion from the convertible bond issuance to support its international business and replenish working capital, despite a significant drop in its overseas revenue contribution from 37.22% to 14.23% year-on-year [4][18]. - The sale of its AssetMark platform for USD 1.793 billion (approximately CNY 12.7 billion) has impacted its international revenue, which was CNY 7.926 billion in 2023, with AssetMark contributing nearly half of that [4][18].