Why is it the flag? Deciphering the new quality productivity of Kingkey Financial International

Green finance shines in 2024, who is the flag?

From a global perspective, green finance has become an industry trend and the trend of the times. International organizations such as the International Finance Corporation (IFC) and the World Bank have advocated green finance, and many countries have introduced policies to encourage financial institutions to invest in green projects.

In China, green finance has rapidly provided a steady stream of vigorous impetus for economic and social development with the vigorous development of new quality productivity. Complementing each other, the new quality productivity is bigger and stronger, and green finance has also entered the fast lane.

Under the general trend, who is the leader of the tide? A closer look at the financial market can be found that a Hong Kong-funded listed company, Kingkey Financial International (01468. HK) always appears in front of everyone at critical moments, standing at the head of the tide and facing the wind and waves. This can't help but be surprising, there is no shortage of elites in the financial market, but why is it that in the end, Kingkey Financial International is the first to stand in the C position? What is its business survival secret?

Tip 1: Anticipate the opportunities of the times, embrace new quality productivity and reconstruct green finance

To put it bluntly, Kingkey Financial International's secret is actually very simple, that is, it seizes the opportunity of the times to reconstruct green finance with new quality productivity.

In recent years, especially since the beginning of this year, droughts, floods, hurricanes and other problems have become increasingly serious, both in the global environment and in the domestic environment. At the World Economic Forum's 15th Annual Meeting of the New Champions (Summer Davos) held from 25 to 27 June, climate change became the main focus of the forum, with many participants from politics, business and academia around the world engaging in heated discussions and finding solutions.

Among the answers given at the end of the conference, green finance was among them. The reason why everyone is optimistic about green finance is that its core concept is to promote environmental protection and efficient use of resources through financial means (green bonds, green credit, green funds, green insurance, etc.), which provides a stable source of funding for environmental protection and sustainable projects, and also provides investors with safer and more sustainable investment options.

Feedback to the financial market, the final result is that the scale of green bonds, carbon allowance trading, and green loans continues to expand. As of March, the cumulative issuance of labeled green bonds that meet the Climate Bonds Initiative (CBI) standards worldwide reached $2.98 trillion. The cumulative turnover of carbon allowances in the mainland carbon market was 25.592 billion yuan, and the turnover in March was 273 million yuan, an increase of 50.3% month-on-month. According to the central bank, green loans maintained rapid growth in the first quarter, with the balance of green loans in domestic and foreign currencies reaching 33.77 trillion yuan, a year-on-year increase of 35.1%.

It is based on the accurate prediction of the general trend of green finance that Kingkey Financial International (01468. In the past year, it has withstood the dual pressure of the market and short-term operation, transformed into green finance, restructured with new quality productivity, and finally achieved a brilliant C position.

From the recent series of announcements of Kingkey Financial International, we can clearly see the traces of its green finance strategy step by step.

First; It signed a memorandum of cooperation with Chain of Demand Limited, a Hong Kong-based artificial intelligence technology company, to use AI (artificial intelligence) to conduct big data analysis and build data analysis models to protect the company's investment efficiency.

Second; It signed a memorandum of understanding (MOU) with Prime Road Power Public Company Limited, a Thai listed company focusing on renewable energy development, to initiate the discussion and development of financial products related to solar power plants and energy technology, and to promote energy technology solutions that meet ESG standards, resulting in the birth of the first green insurance solution of its kind.

Third; It also plans to establish a joint venture with NVIDIA's key AI computing partner, Thailand's SIAM AI, to build AI data centers and provide green investments to integrate future computing power to meet ESG sustainability requirements.

Transform green finance and fully embrace green new quality productivity. It can be said that it is this series of actions that has become the growth engine of the company.

Tip 2: Anchor the strategy unswervingly, strengthen strategic self-confidence to win the future

The most feared thing for any enterprise is that after the strategy is set, it will fall into self-doubt when it encounters some problems or resistance, so that the strategy is ever-changing in the implementation process, and the last look at the strategy is equivalent to nothing, and the company has lost the most precious golden time for development.

Another secret of Kingkey Financial International's success in becoming a C-position debut is that the strategic anchoring is unwavering, and the company is firm in strategic self-confidence. We will work together to adhere to a blueprint to the end, insist on green finance and never give up, and finally win market praise with facts.

It can be seen that in Kingkey Finance's international green finance strategy, there are actually many problems and resistances, but they did not give up on the spot and raise the white flag, but rose to the challenge, bited hard bones, solved problems when there were problems, and dissolved resistance when there was resistance. For example, the company decisively terminated its sublicensing partnership with the FGA (Forbes Global Alliance) after reassessing its portfolio and business focus. Kingkey Financial International's management recognized that since the company has resolutely transformed into green finance, it should not continue to waste resources on traditional financial business, but should do its best to invest in more promising green finance and sustainable development.

From the perspective of the company's business, Kingkey Financial International's short- and medium-term performance in the transformation of green finance strategy has been affected by some factors, and it has experienced a period of pain, but after anchoring the strategy, it is found that the company is actually right to insist.

Significant narrowing of losses and increased profit: In FY2024, the Group's loss was approximately HK$687.4 million, a significant improvement from a loss of HK$1,163 million in the previous year. This was due to the termination of FGA HK's trademark sub-licensing agreement, which provided long-term value in exchange for more funds for the development of the core business. Excluding this impact, the Group will also achieve a profit of approximately HK$34.5 million, avoiding impairment of non-cash goodwill, intangible assets and right-of-use of approximately HK$721 million. The final adjusted profit reached HK$34.6 million, an increase of HK$1.4 million year-on-year. The company's operation and management alone has boosted investor confidence.

Assets and liabilities from weak to strong: According to the financial report, as of March 31, the company's assets increased from HK$373.8 million in fiscal 2013 to HK$405.0 million, an increase of HK$31.2 million. The asset structure was further optimized, and the financial health was further improved. As a result of the completion of the contingent consideration payable in connection with the consideration for the second tranche of shares in the acquisition of the FGA business, the Company's net current assets reached HK$221.7 million, compared to the current liability position of HK$434.5 million last year.

Significant improvement in cash flow: Bank balances and cash increased by HK$7.5 million from the previous year to HK$118 million. The increase in cash flow can be said to provide sufficient ammunition for Kingkey Financial International to firmly transform green finance and respond to the investment needs of emerging markets.

To sum up, Kingkey Financial International has become the leader of green finance, which can be said to be the dividends of the times that the company naturally enjoys after predicting the opportunities of the times and anchoring the strategy. From the point of view, with the continuous deepening of the green finance strategy and the continuous improvement of its financial situation, it will further strengthen its confidence and strength in deepening the promotion strategy, as well as the confidence and tension to empower the development of the industry, and then promote the realization of higher performance goals.

It can be said that with the firm implementation of the green finance strategy, even if Kingkey Financial International encounters challenges such as policy risks, technical risks and market fluctuations in the future, because of its own experience in facing challenges in the early stage of the implementation of the strategy, it not only has a stronger strength guarantee, but also has more experience in facing risks, which is also the confidence and confidence of Kingkey Financial International to continue to lead the trend in the future market competition.