Chapter 254: The profits are coming in droves!

The rise of Whampoa Group also had a significant impact on Chinachem and Cheung Kong.

Of course, needless to say, those small and medium-sized real estate developers are basically uncompetitive now, such as Dasheng Real Estate, Great Eagle Properties and the like.

It also has a great impact on Chinachem Properties. In the past, Chinachem Properties was one of the largest owners of land exchange rights certificates, but now Whampoa Group is the one that owns the most land exchange rights certificates.

Whenever no one is interested in the land exchange rights documents, Huangpu Group is always the first to take them all.

In addition to acquiring land through land exchange rights certificates, old properties, private auctions, and government land auctions.

In the past two years, he has been sought after by some land-owning business owners because of his good reputation and ability to grasp the real estate situation.

They took the initiative to contact the Huangpu Group to jointly develop its land, which is a very good cooperation for both parties!
For entrepreneurs, they only have land and factories to move to the mainland, but have no experience in real estate development.

The Huangpu Group not only takes care of its allies in cooperation, but also has a very good grasp of the general trend, allowing it to sell houses at high prices.

For the Huangpu Group, they do not need to use land reserves. They only need to take out a small amount of money as start-up capital. They can complete a real estate project through loans and sales of pre-sale properties, which is quite cost-effective.

Liu Zhicheng immediately said: "We are preparing to release 750 residential units in Huijing Garden by the end of March."

Hao Qingwen nodded quickly and said, "Okay!"

Huijing Garden has a total of 4100 residential units, and 750 of them will be sold by the end of March. It is estimated that they can be sold at HK$2400 per square foot by then, and more than HK$12 billion can be recovered in one go.

Of course, you still have to pay back the bank.

Because Liu Zhicheng calculated the average selling price for this community to be HK$3500 to HK$4000, it would take three years to sell out.

As far as Liu Zhicheng knows, Hong Kong needed more than 50 residential units throughout the 36s, but in fact only residential units were produced.

The demand is still very strong, but some people just can’t afford it!

Although there are several reconstruction projects at present, it still does not affect the huge scale of Whampoa Group's rental properties.

With a net profit of just over HK$10 billion from rental income, it is undoubtedly a very profitable real estate company and should be ranked number one.

Next, senior staff members gave their reports one after another, and the atmosphere in the entire conference room was very good.

Liu Zhicheng finally announced: "I plan to have Huangpu Group announce its annual results and distribute dividends after the new year, with a dividend of HK$1 per share, involving a capital of HK$15 billion!"

.........

Alligator Building.

A piece of news caught his eye: Europe was in the trough of economic recession, and the famous British department store HARVEYNICHOLS, which has a history of 180 years, was also in crisis due to heavy losses.

Harvey Nichols is one of the three largest department stores in the UK, with a total of 16 stores worldwide, 8 of which are in the UK.

Even though it is a loss-making enterprise, if it was a profitable enterprise, there would be no chance for a Chinese like him to take over.

Although the department store industry is traditional, it still has 15 to 20 years of potential.

More importantly, he wanted to develop his own clothing line in Europe through this department store.

Liu Zhicheng quickly took it to heart and prepared to send someone to investigate.

In 1990, the Crocodile Garments Group's net profit reached HK$5.8 million, setting a new record.

In the new year, Liu Zhicheng plans to start preparing for acquisition activities, strive to enter the international fashion field and improve the quality of the entire group.

Of course, before that, Crocodile Group still has a lot to do.

In the conference room, Liu Zhicheng listened to the reports from various brands with a faint smile on his face, expressing his satisfaction.

"Crocodile has opened 106 specialty stores around the world, all of which are self-operated stores; among them, 36 stores are in Hong Kong, 32 in Japan, and 16 in Southeast Asia. They are spread across Europe, America and Asia."

"Jeanswest currently has 58 stores, 22 of which are in Hong Kong. They are spread across Europe, America and Asia."

"Zodanno currently has 52 stores, 18 in Hong Kong and 16 in Taiwan. It is spread across Europe, America and Asia."

"There are 36 stores selling IT fashion (Hong Kong-style clothing brands), 18 of which are in Hong Kong. They are spread across Asia."

"In addition to the group's business, the manufacturing department's OEM business currently accounts for 3%."

After listening to everyone's reports, Liu Zhicheng said: "Very good, we must make persistent efforts this year! This year our mission is still global operation. I will also strengthen the group's management and design capabilities, and enter the European fashion industry!"

Everyone was immediately surprised. Although Crocodile, Giordano and Jeanswest had all entered Europe, they did not dare to say that they had entered the European fashion industry.

For a moment, everyone became curious.

Seeing this, Liu Zhicheng smiled and said, "Of course, through acquisition, we will turn our company into a multinational enterprise!"

Everyone suddenly realized that this is what the boss is good at!

Everyone knows that the boss's goal is to build Crocodile Group into the LVMH Group of Asia, and this goal can only be achieved through acquisitions.

This is actually what Liu Zhicheng planned. Currently, the market value of Crocodile Garment Group is 38 billion Hong Kong dollars.

Once the results are announced, combined with this year's market conditions, there will be no problem for the market value to increase to HK$60 billion.

He will issue shares to raise funds to prepare for the acquisition!
As for the group's profits, they are retained as development funds.

After the meeting, Liu Zhicheng held a private meeting with President Huang Qisong.

"You go to Europe to upgrade the office to the European headquarters and recruit elite talents, mainly designers, marketing operations and other talents. We are going to acquire a European brand as a step to enhance our brand!"

There are indeed many Hong Kong people who have acquired European and American companies. For example, in November 1987, Dickson Poon announced that with the approval of the French government, he had acquired the French brand Dupont for US$11 million.

DuPont is a famous brand company with a history of more than 100 years, specializing in serving the French upper class.

There are so many famous European brands that Liu Zhicheng naturally would not miss any of them.

One advantage of acquiring European brands is that they can be introduced to Asia for promotion.

Huang Qisong immediately said: "Well, I'll get ready as soon as possible!"

Liu Zhicheng took out the morning newspaper, handed it to him and said, "Help me investigate this department store, and then you do an investment feasibility study. I want Crocodile Shirt Group to acquire it!"

Huang Qisong nodded and said, "Okay, we'll finish it as soon as possible and give you a plan!"

Liu Zhicheng reminded him, “Although I don’t know the specific situation yet, I am familiar with the decline of the department store industry, which also happened in Hong Kong.

My general idea is to reform it, focus on fashion, and introduce catering and beauty industries. In short, it is to make people stay in this place for a long time, instead of just shopping! "

Huang Qisong showed admiration on his face. This boss is truly a business genius.

"Okay, we will take your opinion into consideration and carefully investigate Harvey Nichols Department Store!"

Liu Zhicheng nodded with satisfaction. This was the correct acquisition model.

Generally speaking, acquiring such a company requires a team to conduct investigation for several months or even half a year.

Of course, Liu Zhicheng pays attention to efficiency, and he has already formed a preconceived idea in his mind, so the acquisition efficiency will not be that low. I believe we will have the answer in a month or two!

The investment department of Crocodile Garment Group needed to investigate the specific situation of this department store for him: asset situation, operating situation, reasons for failure, etc.

It is also necessary to formulate a recommended acquisition price, acquisition strategy, and subsequent business policies for Liu Zhicheng.

.........

Time flies, and the Spring Festival of 1991 has passed in a blink of an eye. Huangpu Group officially released its performance announcement and announced its dividend plan.

For a moment, Hong Kong and Kowloon were shocked!
With a net profit of HK$80.5 billion, it surpassed HSBC and became the most profitable company in Hong Kong.

However, many people have also noticed that Whampoa Group's non-recurring profits last year were as high as HK$41 billion, needless to say, it is the stock god who is operating the financial investment.

But no matter what, after Huangpu Group announced its performance that day, its stock price immediately rose by 5%, and even the broader market soared by 3%. The small market drove the broader market.

The more than 5 shareholders of Whampoa Group were all smiling with joy. Not only did they receive a dividend of HK$1 per share, but their stock price also rose by 5%.

The market value of Whampoa Group rose to HK$580 billion, with a total share capital of 15 billion shares, making it the most eye-catching stock in the market.

In the office, Liu Zhicheng was delighted as he watched the Whampoa Group's stocks soar.

Although he has not thought about cashing out, it does not prevent him from being happy because he has created value for shareholders.

As for the more than 10 billion Hong Kong dollars in dividends this time, he still has to pay for it himself and raise funds through a rights issue.

Huangpu Group's shares are relatively dispersed. There is no second or third shareholder, only Liu Zhicheng, the major shareholder.

Because many large institutions were afraid of Liu Zhicheng's gambling-style investment and frequent share issuance and fundraising at the beginning, they did not choose to invest heavily.

On the contrary, ordinary investors, because of their admiration for Liu Zhicheng, bought shares of Huangpu Group.

Because of this, no shareholders holding more than 3% of the shares have been found so far.

…………

On Saturday, Liu Zhicheng and his son Cha Jimin and others came to Discovery Bay Golf Course.

Discovery Bay is so huge that even after 40 years of development by Hong Kong Development Bank, it still has not been fully developed.

However, Cha Jimin lacked strength, and almost half of all the profits from projects in his previous life were taken away by New World Development.

Several people sat in the club, drinking tea and chatting, mainly discussing business matters.

Cha Maosheng was a little anxious about the delay in the approval of the airport plan, so he couldn't help but complain.

Liu Zhicheng explained: "It will definitely be passed this year because Hong Kong's economy can no longer be delayed.

Moreover, as far as the current situation is concerned, everyone knows that Discovery Bay has a very good future, so there is no need to worry about Phase 4 and Phase 5 not being able to sell at a good price.”

Before the airport plan was announced in 1989, the housing price in Discovery Bay was only over HK$500 per square foot.

Last year (1990), the price had reached HK$1000 per square foot, far exceeding the original agreed price of HK$650 per square foot.

However, the Cha Jimin family still has a large amount of undeveloped land in Discovery Bay, so they naturally hope that the new airport plan can be implemented as soon as possible.

Cha Jimin said: "I also believe that the new airport plan can be released this year. It is said that the two sides have already started communicating secretly."

Liu Zhicheng said: "This is inevitable. Kai Tak Airport is almost overloaded. I believe both sides can see it."

Kai Tak Airport has long been the busiest airport in the world, and a new airport plan had to be proposed in the late 1980s. However, this involved a game between China and Britain, and things were a bit complicated.

However, in recent years, there has been a lot of public outcry, so the two countries have to consider Hong Kong's economic needs.

Everyone is very optimistic about the future of Discovery Bay, and the involvement of Whampoa Group is indispensable in the future, so the cooperation will have to continue for a long time.

In the past, some people even used the Discovery Bay project as the signature project of the New World Group, because the New World Group actually made greater profits from residential projects.

However, due to its lack of strength, Xiangjiang Xingye can only seek cooperation with large real estate companies and share part of its residential profits with them.

Xiangjiang Xingye can not only enjoy the profits from the residential properties, but also obtain all the rights and interests of the commercial portion.

The Cha family’s idea is simple: as long as the houses are sold, their Discovery Bay will become popular.

Then they can build comprehensive projects such as hotels, shopping malls, golf clubs, office buildings, etc. and collect rent for a long time.

During the meeting, everyone inevitably discussed the real estate situation. Liu Zhicheng used the phrase "ready to go" to describe Hong Kong's real estate prospects, which made everyone more confident.

In fact, almost everyone knew at this time that Hong Kong’s real estate was about to explode because the Gulf War was about to end.

At this time, Cha Jimin said, "What do you think about Mingli Group (the parent company of Xiangjiang Xingye) planning the Huaxia Dyeing Factory on Qingshan Road in Tsuen Wan into a residential and commercial integrated project?"

Liu Zhicheng immediately said: "The project is very promising. The economy in Tsuen Wan is developing very fast. Isn't my Whampoa Group developing large-scale commercial projects there?
We are located in the south and north of you, and we have a favorable position in the commercial center of Tsuen Wan."

Of course, there is no comparability at all. The geographical location of Huaxia Dyeing Factory is too poor, transportation is inconvenient, and not much commercial space can be built.

The Tsuen Wan Plaza and Tsuen Sun Plaza planned by Liu Zhicheng are surrounded by beautiful environment, have parks for recreation, and are close to the sea. The subway, Kowloon Motor Bus and minibuses all have terminal stations there.

It can be said that the project created by Liu Zhicheng is comparable to the value of the Citizens Centre in Central, or even higher; and, this does not include the two residential projects.

Liu Zhicheng continued with a smile, "We can save hundreds of millions of Hong Kong dollars by negotiating the land premium with the Hong Kong government as soon as possible. If we plan the project cycle for five or six years, the profits will roll in!"

Cha Jimin said: "The land compensation fee is probably about 20 to 30 billion Hong Kong dollars, right?"

Liu Zhicheng said: "It is estimated to be more than 25 billion. Now the Hong Kong government has learned to be smart, and it is difficult to take advantage of them. Moreover, the longer it is delayed, the more expensive the land compensation fee will be. There is no room for negotiation!"

Liu Zhicheng was not wrong. This piece of land cost 38 billion Hong Kong dollars in the previous life.

Moreover, only 160 million square feet of floor area (residential) and 90 square feet of commercial floor area can be built.

The Cha family father and son took a deep breath. It was inevitable that they did not have the strength to develop the business on their own. Moreover, they were not good at bargaining with the Hong Kong government.

Cha Jimin said, "I plan to cooperate with you, what do you think?"

Liu Zhicheng first expressed his position: "Huangpu Group can just participate casually. I can also participate in providing advice and suggestions."

Liu Zhicheng is a big friend of real estate, and almost all large-scale commercial businesses cannot escape his control.

He would also get involved in any large-scale real estate development and form a consortium to win the bid.

There is no way. Huangpu Group has sufficient cash flow and it is impossible for the money to rot on the account.

Therefore, he looked down upon small projects like the dyeing factory.

Judging from recent developments, if the Hong Kong government conducts an auction of government land, there is a very high possibility that Whampoa Group and Sino Land will cooperate again for any large-scale residential project.

Because neither party wants to bid too high a price at the auction.

Cha Jimin added: “I want to reserve a piece of land for a commercial building. I plan to build the Zhongran Building. I plan to let Mingli Group hold this project alone.

So although this project is planned as a whole, the commercial project belongs solely to our Mingli Group!

I think what Zhicheng said makes sense. The sooner we negotiate with the Hong Kong government, the less land premium we can pay. Let’s have formal discussions as soon as possible!”

Liu Zhicheng nodded and said, "Okay, let's do it next Wednesday!"

Soon, everyone agreed on a project.

Even if he only holds a 2% stake in this project, Liu Zhicheng believes that he can still make about HK$10 billion.

Because housing prices in Hong Kong have been rising so fast, by the time the first phase was sold in 1993, the price had probably risen to around HK$5000 per square foot, while the current price in the same area is only around HK$1800 per square foot.

The benefits are rolling in!

(End of this chapter)