324: Chapter 324 A Feast of Capital

On July 8th in Shenzhen, the sky was as blue as if it had been washed.

Inside the press conference hall at the Spark Group headquarters, over three hundred reporters stood ready.

Long lenses and short cannons were aimed at the podium, and the red lights of the cameras flickered incessantly.

This was Su Chen's first public appearance since the Xingchen seven-day press conference.

Outside the press hall, security personnel were stationed every three steps, strictly checking the credentials of every entrant.

Inside the hall, the air conditioning was set high, yet fine beads of sweat still seeped onto the reporters' foreheads—not because of the heat, but because of nervousness.

The news to be released today was enough to shake the global capital markets.

Under the crystal chandelier, Su Chen walked onto the podium.

He wore a dark gray shirt and black trousers, with his sleeves rolled up to his forearms.

No suit, no tie, no manuscript.

On the large screen behind him, there was only one line of text: Spark Power Technology - Spin-off Listing

No superfluous embellishments, no emotional opening remarks.

Su Chen stood still, his gaze sweeping over the reporters below, and he spoke calmly:

"By resolution of the board of directors, Spark Power Technology will be officially listed on the Shanghai Municipality Stock Exchange on August 1, 2018."

As soon as he finished speaking, flashbulbs lit up like a tsunami.

Click, click, click—the sound of shutters was as dense as machine-gun fire.

The large screen switched, displaying key data:

Spark Power Technology IPO Details

Listing Location: Shanghai Municipality Stock Exchange

Listing Date: August 1, 2018

Pre-issuance Total Share Capital: 16 billion shares

Issue Price: 100 rmb/share

Financing Amount: Additional issuance of 4 billion shares, raising 400 billion rmb

Post-issuance Total Share Capital: 20 billion shares

Post-issuance Market Capitalization: 2 trillion rmb

Proportion of Circulating Shares: 20%

Below, the reporters were frantically recording.

Someone took out a mobile phone to calculate; two trillion divided by four hundred billion, the price-to-earnings ratio was 12.5 times.

Someone looked up the data for CATL, the price-to-earnings ratio was 35 times.

Someone whispered in surprise: "This valuation is too conservative!"

What is the concept of two trillion?

It exceeds the sum of CATL, BYD, and LG Energy Solution.

It is equivalent to a one-time discount of the global power battery market's profits for the next five years.

It is equivalent to building forty Hong Kong-Zhuhai-Macau Bridges.

It is equivalent to giving every person in China 1,400 rmb.

At 10:30 AM, the reporter Q&A session began.

A reporter from The Wall Street Journal was the first to raise his hand.

He was a middle-aged white man in his forties, wearing gold-rimmed glasses, with his hair meticulously combed.

His name was James Carter; he had stayed in China for eight years and considered himself well-acquainted with this land.

"Mr. Su, is a valuation of two trillion too high? Can Spark Power's profitability support it?"

His question was sharp, carrying obvious skepticism.

Su Chen looked at him and smiled.

"My reporter friend, Spark Power currently holds an 82% share of the global power battery market. In the first half of 2018, the net profit exceeded 80 billion rmb."

He paused, walked to the large screen, and pointed to the data on it:

"80 billion in net profit, multiplied by two, is 160 billion for the whole year. A 2 trillion valuation corresponds to a price-to-earnings ratio of about 12.5 times. CATL's price-to-earnings ratio is 35 times. You tell me, is it high or low?"

James Carter opened his mouth, finding himself speechless.

Su Chen continued: "The logic of capital market pricing is the discount of future cash flows. Spark Power's orders for the next five years are already full; Honda, Nissan, Volkswagen, and BMW are all our clients. You tell me, is a price-to-earnings ratio of 12.5 times high or low?"

Low laughter broke out below.

A reporter from Nikkei News raised her hand.

She was a Japanese woman in her thirties, wearing a dark suit and rimless glasses.

Her name was Nakamura Masako, a senior financial reporter dispatched to China by the Tokyo headquarters.

"Mr. Su, what impact will Spark Power's listing have on the global battery industry?"

Su Chen's answer was more direct.

"Spark Power's listing is not for financing, but for sharing. We already have partners like Honda and Nissan. After the listing, global investors can share in Spark Power's growth."

He looked at the lens, his gaze seemingly piercing through the camera, reaching directly into the eyes of every investor around the world.

"Of course, the premise is—accepting Xingchen's rules."

Nakamura Masako followed up: "What are Xingchen's rules?"

Su Chen smiled.

"First, Xingchen's technology can only be used for civilian purposes. Second, Xingchen's partners cannot use the technology for military purposes. Third, Xingchen's investors cannot use Xingchen's technology to harm Xingchen's interests."

He paused.

"Very simple, right?"

At 11:00 AM, London, HSBC headquarters.

The HSBC Tower is a landmark in the City of London, its 42-story glass curtain wall shining in the sunlight.

In the chairman's office on the top floor, Mark Tucker sat behind his desk, watching the Spark Power IPO news pop up on the Bloomberg terminal.

The 60-year-old Tucker was a veteran in the banking industry, having worked at HSBC for 35 years, rising step by step from a junior loan officer to chairman.

He had experienced the Asian financial crisis, the 2008 crisis, and countless IPOs.

But this time, he felt a sense of unusual urgency.

He picked up the phone and dialed the number for the International Business Department.

"Contact the Shanghai Municipality branch immediately and apply for the underwriting qualification for Spark Power. This is the best IPO in a decade; we cannot miss it."

On the other end of the line, the assistant hesitated: "Chairman, the US sanctions on Xingchen..."

Tucker interrupted him: "US sanctions are the US's business. HSBC is a British bank. We must be responsible to our shareholders."

He hung up the phone, stood up, and walked to the window.

Outside the window, the River Thames flowed slowly, and the London Eye Ferris wheel rotated slowly in the sunlight.

"US sanctions..." he muttered to himself, "By the time they figure it out, the opportunity will have long passed."

At the same time, New York, Goldman Sachs headquarters.

The Goldman Sachs building is located in Lower Manhattan, a 200-meter-tall black building that is a symbol of Wall Street.

In the CEO's office on the top floor, David Solomon also saw the news.

The 55-year-old Solomon was a legendary figure at Goldman Sachs, becoming a partner at 28 and taking charge of this investment bank at 47.

He had handled countless major deals—the Alibaba listing, the Facebook listing, the General Motors restructuring.

But at this moment, he could only smile bitterly.

The assistant stood by, asking cautiously: "Sir, shall we apply for underwriting?"

Solomon shook his head.

"Even if we apply, it won't be approved. Xinghuo is on the sanctions list. Xingchen won't let American banks touch their stock."

He stood up and walked to the window.

Outside the window, the Manhattan skyline was as bustling as ever, with the Statue of Liberty looming in the distance.

"We have missed something," he muttered.

Tokyo, Nomura Securities headquarters.

Nomura Securities is Japan's largest brokerage, with its headquarters building in Nihonbashi, Tokyo, which is simple and solemn.

In the president's office, Koji Nagai was holding an emergency meeting.

The 62-year-old Koji Nagai had worked at Nomura for 40 years, rising step by step from a junior trader to president.

His style was decisive, aggressive, and never hesitant.

He made the decision directly: "Form a team to go to Shanghai Municipality. Strive for an underwriting share."

Someone reminded him: "President, the US and Japan are allies..."

Koji Nagai sneered: "Allies? The US sells us the F-35 for over $100 million each. We bought hundreds; what did we get in exchange? What's wrong with us buying some of Xingchen's stock?"

He paused: "Besides, Honda and Nissan are already cooperating with them. If Nomura doesn't go, Sumitomo Mitsui will."

At 2:00 PM, Shenzhen, Xingchen Headquarters Financial Center.

The Financial Center was on the 30th floor of the Xingchen Headquarters building, an entire floor of open office space where dozens of financial staff were working intensely.

On the large screen on the wall, the dynamics of the global capital markets were scrolling in real time.

CFO Shen Nanpeng sat in his office, staring at the data on his computer screen.

The 48-year-old Shen Nanpeng was the financial director of Xingchen and Xinghuo, having worked at Morgan Stanley in the US for 20 years, rising from a regular analyst to Vice President of the Asia-Pacific region.

He had seen countless major events and handled countless major deals.

But at this moment, his eyes were flashing with excitement.

Su Chen pushed the door open and entered.

"Mr. Shen, how is the situation?"

Shen Nanpeng looked up with a smile on his face: "Mr. Su, the 400 billion financing has set a historical record for the A-share market. Over 200 institutions globally have expressed interest. European, Japanese, and Middle Eastern ones have all come. Not a single American one."

Su Chen nodded: "As expected. US sanctions on Xinghuo just happen to let Europe and Japan take a larger share."

He walked to the window and looked at the Shenzhen skyline.

The Ping An Financial Center was shining in the sunlight; it was the tallest building in Shenzhen and also the symbol of this city.

"Two trillion is just the beginning."

Shen Nanpeng asked: "Mr. Su, is setting the issue price at 100 rmb too conservative? Based on market heat, we could issue it at 150 rmb."

Su Chen shook his head: "100 rmb is to leave room for the secondary market. What we want is not one-time financing, but long-term market value management. If the stock price rises too fast, it's easy to overdraw the future."

He turned around: "Make concessions to investors, and they will remember it."