Chapter 23: Formulating a New Plan
Lin Haoran reviewed the stocks currently in his possession and carefully calculated the flow of funds over the past month.
During that period, he had not only invested his own HK$1.5 million into the stock market but had also secured a HK$50 million loan.
Aside from the HK$500,000 he had withdrawn as "tea money," the remaining HK$49.5 million had all been deposited into the bank account linked to his stock trading account.
In other words, his total investment in the stock market amounted to HK$51 million.
Breaking it down in detail, over the past month he had successfully acquired 6.45 million shares of Qingzhou Yingni.
With the average purchase price rising to HK$4.96 per share, that investment had cost him approximately HK$31.99 million.
As for Wharf Holdings, although accumulation had only begun five days earlier, he had already purchased 387,900 shares at an average cost of HK$23.05 per share, totaling roughly HK$8.94 million.
Combined, his total investment in both stocks had reached approximately HK$40.93 million.
That meant he now had only about HK$10.07 million in liquid funds remaining.
By the standards of his long-term ambitions, that mere ten million dollars was nowhere near enough.
After all, his investment strategy wasn't limited to continuing to accumulate Qingzhou Yingni shares.
He also intended to acquire a much larger stake in Wharf Holdings.
More importantly, he needed to earn enough profit from the future appreciation of Wharf Holdings' stock to repay the enormous loan.
With that objective in mind, his remaining capital was clearly insufficient.
As such, making the most efficient use of every dollar would become one of the most important issues he needed to consider.
How could he raise another round of capital?
An idea quickly came to him.
His eyes fell upon the Qingzhou Yingni shares he already held.
He recalled his previous agreement with Yang Changdao.
According to their contract, once he had accumulated enough shares, he had promised to pledge approximately HK$20 million worth of stock as collateral to Yumin Finance Company.
However, the agreement allowed a six-month deadline, giving him plenty of time.
Since that deadline was still far away, Lin Haoran had no intention of immediately mortgaging those shares to Yumin Finance Company.
Instead, he saw an opportunity to use those shares as leverage to obtain even larger loans, allowing him to purchase even more stock.
According to his knowledge of Hong Kong's stock market in this era, margin financing based on existing stock holdings—the kind common in later generations—didn't yet exist.
That financing model would only become widespread in the late 1980s.
Since the stock market itself couldn't provide leverage...
He would simply create his own.
His plan was to use the shares he already owned as collateral to borrow money from financial institutions or private investors, obtaining additional capital to expand his stock investments.
Through this approach, he could effectively achieve the same result as leveraged investing—
Using relatively little of his own money to control a much larger pool of assets.
For ordinary investors, such a strategy carried considerable risk.
But Lin Haoran knew the history of the battle for control of Wharf Holdings.
To him...
There was virtually no risk at all.
Compared to Wharf's enormous market capitalization, the tens of millions he intended to invest were merely a drop in the ocean.
His purchases wouldn't be enough to alter the overall direction of the market.
Therefore, he decided not to rush into fulfilling his agreement with Yumin Finance Company.
Instead, he would maximize the value of his holdings by taking advantage of future price appreciation before using them as collateral.
Since he intended to sell his Wharf Holdings shares within the next few months, they obviously weren't suitable as loan collateral.
That left only one choice.
He would pledge his Qingzhou Yingni shares.
At present, those shares were already worth over HK$30 million.
Using such high-quality assets as collateral, he estimated he could easily secure another HK$30 million or more in financing.
With this strategy firmly established, all of Lin Haoran's concerns disappeared.
He planned to continue investing in both Wharf Holdings and Qingzhou Yingni simultaneously.
The two investments would complement each other, driving the growth of his wealth together.
He was completely confident that, through careful planning and disciplined execution, both investments would generate outstanding returns.
Setting down his notebook, Lin Haoran noticed that Su Zhixue was still in the office.
He smiled warmly.
"Zhixue, you should head home.
Your son is at a crucial stage of his recovery. The more your family can be there for him, the faster he'll recover.
Go home early.
The two of you should spend more time with him."
He recalled that two weeks earlier, Su Zhixue's son had successfully undergone surgery and had now entered the rehabilitation phase.
Because of that, ever since then, Lin Haoran had encouraged Su Zhixue to leave as soon as the stock market closed at four every afternoon so he could devote more time to caring for his family.
After all, he hadn't officially established his own company yet.
Nor had he put formal corporate rules in place.
There was no need to manage things too rigidly.
"Mr. Lin, I'll be heading home then. Thank you."
Su Zhixue left with heartfelt gratitude.
After Su Zhixue departed, Lin Haoran sat alone in the office, deep in thought.
If he wanted to use his Qingzhou Yingni shares as collateral for another loan, it was obvious that Yumin Finance Company was no longer an option.
So...
Which bank or financial institution should he approach?
Without question, HSBC was currently the largest financial institution in all of Hong Kong.
If he truly wanted to establish himself in Hong Kong's business world, building a good relationship with HSBC was inevitable.
Obtaining loans from HSBC would also be far more convenient thanks to its extensive financial resources.
Of course...
HSBC's lending standards were much stricter.
Unlike Yumin Finance Company, there was absolutely no way HSBC would lend HK$50 million against collateral worth barely HK$10 million.
There was another issue as well.
Qingzhou Yingni itself was also a British-owned enterprise.
If he openly applied to HSBC for a loan to finance further purchases of Qingzhou Yingni shares, news of his becoming one of the company's largest shareholders might leak out.
That would create unnecessary risks.
At the moment, Lin Haoran had no intention of publicly revealing that he had already become Qingzhou Yingni's largest shareholder.
Maintaining a low profile would help him avoid attracting excessive market attention and unnecessary volatility, allowing his investment strategy to proceed more smoothly.
However...
If he could negotiate directly with HSBC's senior management—
Especially David Akers-Jones? No.
Michael Sandberg (Shen Bi), the bank's powerful Chief Manager—
Then perhaps he wouldn't need to worry so much.
Someone at Shen Bi's level was expected to maintain strict commercial confidentiality.
For an enterprise the size of Qingzhou Yingni, it was unlikely that a senior executive like him would compromise his professional reputation over such information.
The only question remaining was...
Would a HK$30 million loan be significant enough to attract Shen Bi's personal attention?
(End of Chapter)
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