Reborn as a tycoon in Hong Kong

The next day is Monday.

Without any surprise, Hutchison Whampoa's stock price plunged during the call auction stage. After the opening, it quickly fell below the price of HK$30, with the lowest falling to about HK$27. Then it rebounded and fluctuated in a range at the price of HK$30.

Despite this, Hutchison Whampoa's share price has fallen by about 20% that day, losing almost 3 billion Hong Kong dollars in market value.

Hutchison Whampoa, in Lin Baicheng's office.

"Mr. Lin, it has only fallen by about 20% now, and it may fall further in the future."

Wei Li said this when secretary Qin Lan reported the latest stock price.

Cheng Yufeng also said: "Since someone is shorting, such a small drop will definitely not satisfy the short side."

Xia Boyin asked: "Mr. Lin, if the stock price drops again, do we need to allocate funds for repurchase?"

"Forget about diverting funds, the company's development cannot be affected."

Lin Baicheng shook his head, and then said: "At that time, you can borrow a sum of funds from HSBC or Standard Chartered. If the bank is willing to provide a loan, then use the loan funds to buy back; if the bank is worried about risks and is unwilling to provide loans, then forget it. .”

"As long as the company needs a loan and the loan funds are not too large, there should be no problem."

Weili said in a deep voice: "The company's net assets far exceed the company's liabilities. In addition, the company's operations are no problem, and HSBC is the company's major shareholder. There should be no problem in giving the company a loan."

"No problem is best."

Lin Baicheng nodded and said with a smile: "You don't have to worry too much. I have already contacted my friends in the United States. If the stock price drops too hard, he will come in and help me support the stock price, so the drop in the stock price is only temporary. , it will rise back sooner or later.”

"What you have to do is to appease the company's employees so that they will not be affected by the outside world and work with peace of mind. The stability of the company is the most important. At this time, any slight disturbance will be magnified and turn into major negative news. "

"Don't worry, Mr. Lin, we will do a good job in the relevant work."

Wei Li nodded to express his understanding. He is now also a small shareholder of the company. Of course, he does not want problems with the company's development, otherwise the stocks in his hands will become worthless.

"Hey! Hey! Hey!"

There was a knock on the door and Peter Wei walked in.

"Mr. Lin, Standard Chartered Bank unilaterally stopped the private placement negotiations and said it would reconsider whether to accept the private placement and become a shareholder of Hutchison Whampoa."

"Expected!"

Lin Baicheng nodded when he heard this and was not surprised. In the current situation, no one knows to what price Hutchison Whampoa's stock price will fall. What will happen in the future is even more questionable. It is normal for Standard Chartered Bank not to take the risk of accepting a private placement to become a shareholder.

"Mr. Lin, do you want to forward the call from Mr. Huo from Standard Chartered?"

Secretary Chen Huixiang said at the office door.

"Turn in."

Lin Baicheng said, and after the call came in, he picked up the phone.

The call was from Huo Yaohua. He apologized to Lin Baicheng and said that he could only choose to implement the board of directors' decision. He had persuaded the board of directors to talk to Hutchison Whampoa and accept the fixed increase at a lower price, but the board of directors did not agree and considered the risks Too big, need to consider.

After hearing this, Lin Baicheng expressed his gratitude to Huo Yaohua, and then said that Hutchison Whampoa's fixed increase price would not change. Even if the board of directors of Standard Chartered listened to him, the two parties would not reach an agreement in the end because the difference between the fixed increase prices determined by the two parties was too big and there was no negotiation. possibility of success.

Hutchison Whampoa's stock price did not fluctuate for too long around the price of 30 Hong Kong dollars. In less than ten minutes, a large number of sell orders appeared, and the stock price fell below the price of 30 Hong Kong dollars again. This time the key point fell below, causing a large number of panic orders to follow and the stock price soon fell to 25 Hong Kong dollars, and continued to fall.

The total number of shares of Hutchison Whampoa is 400 million. When the stock price fell below the price of HK$25, the total market value fell below HK$10 billion. It is no longer the highest market value among listed companies in Hong Kong.

Because HSBC holds 15% of Hutchison Whampoa's shares, when Hutchison Whampoa's stock price rose sharply, he also rose with it. Now that Hutchison Whampoa's stock price has plummeted, and the overall market situation is not good, HSBC's stock price has naturally continued to fall.

However, unlike Hutchison Whampoa, which was shorted, HSBC was not shorted, so HSBC fell less and barely maintained a market value of 10 billion Hong Kong dollars.

When Qin Lan came to report that Hutchison Whampoa's stock price fell below HK$25, Lin Baicheng nodded and asked her to go out, and then made an international call to Los Angeles.

Maori Haruko told Lin Baicheng that the offshore company had divided the US$100 million into four accounts according to his instructions and opened accounts with Goldman Sachs, Morgan, Citigroup and Merrill Lynch, and then entrusted these four companies to let the four departments in Hong Kong pay attention to Hutchison Whampoa If Hutchison Whampoa's stock price falls below 25 Hong Kong dollars, buy it, and don't care if it is above 25 Hong Kong dollars.

Use your own funds to buy at the beginning, and buy more as the price drops until you run out of money.

Lin Baicheng hung up the phone after confirming that his instructions had been implemented. Although he only used 100 million U.S. dollars to buy, if the stock price is still below 25 Hong Kong dollars after buying it with his own funds, Lin Baicheng will use the 100 million U.S. dollars to use five times the leverage, and then the number of stocks he can buy will be greater. .

If one hundred million US dollars is used with five times leverage, it is 2.1 billion Hong Kong dollars. If all is bought when the stock price is lower than 25 Hong Kong dollars, more than 20% of the shares can be purchased. Lin Baicheng does not believe that this can not make the stock price rise.

If the stock price still fails to rise after buying all the 2.1 billion Hong Kong dollars, then the short side has the ability, and Lin Baicheng can only admit defeat. He must keep the remaining funds as a deposit and cannot gamble all of them. If he loses, he will lose too much and he is not willing to gamble so much.

As Lin Baicheng's funds entered the market, selling orders below HK$25 were caught, and the stock price tended to stabilize and rebound.

At this time, we have to look at the short side’s choice, whether to stop buying the stock near 25 Hong Kong dollars and return it to the brokerage, or to continue to suppress the stock price.

The short side did not make a decision immediately, and Hutchison Whampoa's stock price fluctuated around HK$25. When the stock price was lower than 25 Hong Kong dollars, Lin Baicheng's funds were available; when it was higher than 25 Hong Kong dollars, Lin Baicheng's funds stopped buying, and the stock price fell again after fluctuating for a while.

When the stock price was fluctuating, Lin Baicheng received a call from Shen Zhou. HSBC held a board meeting this morning, and HSBC decided to neither reduce nor increase its holdings for the time being and take another look.

Shen Porridge also told Lin Baicheng another news, that is, the funds currently shorting Hutchison Whampoa are some British-owned families in Hong Kong. For example, the Kaiser family is one of the short parties. They borrowed securities and sold short through the channels of Standard Chartered.

The reason why it is not through HSBC is very simple. HSBC is the majority shareholder of Hutchison Whampoa. This alone is enough.