PangDa Group to go public before year-end

　　Two years after submitted application for listing to China Securities Regulatory Commission, PangDa Vehicles Sales and Trade Group, the largest domestic car dealer group has speeded up its pace recently. SOHU AUTO has been informed that PangDa Vehicles Sales and Trade Group will try to get the approval of China Securities Regulatory Commission within this year and then go on listing on Shanghai Stock Exchange’s A-share Main Board to raise about 2 billion Yuan of funds, which manifests that the integration within the Automobile circulation field is accelerating.

　　Related officials of PangDa Vehicles Sales and Trade Group said 20 billion Yuan is just an estimated number and the exact amount can be only be determined by the price to be issue, which will be affected by relevant factors such as capital market conditions. In addition, the company has not been possible to identify specific time of listing. He also said that during the listing process, the company will not introduce strategic investors.

　　The analyst from National Securities, Cao He said from the funds raised by the previous listing groups, the amount of funds planned by PangDa is relatively appropriate.

　　Previously, ZhongSheng Group Holdings Limited issued IPO286 million shares at Hong Kong IPO, raising 2.862 billion Hong Kong dollars capitals. Though ZhongSheng had planned to raise 1 billion U.S. dollars, they only finish one-third eventually.

　　According to SOHU AUTO, considering the turnover and profits, this time more than 2 billion Yuan can be raised because today the company’s business size and revenue, profits as well as the current situation are all largely improved since when PangDa submitted its listing application to China Securities Regulatory Commission in May 2008.

　　PangDa Vehicles Sales and Trade Group now is the largest domestic auto dealer group. public information shows that till the end of May 2010, the company has established 628 sales outlets in 21 provinces and autonomous regions of China and Mongolia and had and up to 907 branches, subsidiaries and affiliates, including automotive store 450 (4S shop 278: 236 are for passenger cars, 42 for commercial cars; non-4S store 172) and 178 auto malls. In 2009, the company sold totally 360,000 cars and gained 35.5 billion Yuan sales income and 1.01 billion Yuan profit and paid tax 1.01 billion Yuan.

　　ZhongSheng Group Holdings Limited sold out 61, 463 vehicles in 2009 and gained sales income of 13.7 billion Yuan, profits of 471 million Yuan. The number of its 4S stores will reach about 100 at the end of this year. Clearly, the business size and incomes of PangDa Vehicles Sales and Trade Group are far larger than ZhongSheng Group Holdings Limited. Therefore, it is rational that PangDa Vehicles Sales and Trade Group can raise more funds.

　　After go public, PangDa Vehicles Sales and Trade Group will accelerate the pace of expansion through establishing new 4S shops, or purchasing from other distributors. In fact, these two tasks have been in progress all along, only that its listing will accelerate the process.

　　According to Cao He, besides establishing or purchasing new networks, PangDa Vehicles Sales and Trade Group may also develop vehicles. But in the IPO, the company will definitely not implement such a plan. If the materials submitted to the China Securities Regulatory Commission makes clear the main business is the automotive trade, it will never be approved that the company wants to put the funds raised in other business areas, even with auto-related. However, after the IPO go succeed and the funds are raised, the company can invest in vehicle area just with the approval of the Board of directors, which is relatively simple.

　　Recently there has been rumors that PangDa Vehicles Sales and Trade Group is talking with BAIC about to establish JV with Subaru. The above source said he knows nothing about the matter. However, the main business will still be automobile trade even after going public.

　　Cao He said the listing of PangDa Vehicles Sales and Trade Group result from the continuous development of the automotive industry. With the expansion of automotive market and substantially increase of automotive trade, auto dealers groups hope to integration other corporations while enlarging outlets and size, which leads to the financing needs objectively.. Based on these two points, in the future more automobile dealer groups will seek listing.

　　China Automobile Trade field remains highly fragmented. Last year, the 360,000 sales of PangDa Vehicles Sales and Trade Group only account for 2.6% of total car sales. It is estimated that the sales volume of the top ten largest car dealer groups is less than one-tenth of the country’s total sales. With the listing of PangDa Vehicles Sales and Trade Group, YuanTong Group and ZhongSheng Group Holdings Limited property per pass, the integration of auto circulation is expected to be accelerated.

　　(Translator: Yalong/Jessie)

　　See original Chinese report Please click:

　　http://auto.sohu.com/20100729/n273861097.shtml