Overall listing or restart of FAW Group

Overall listing or restart of FAW Group
With the completion of asset restructuring, the overall listing pace of FAW Group may be accelerated.
On March 26, FAW Car Co., Ltd. issued an announcement. At present, it has received the approval of China Securities Regulatory Commission on the approval of major asset restructuring of FAW sedan Co., Ltd. and the issuance of shares to China First Automobile Co., Ltd. to purchase assets. This shows that FAW car asset restructuring project has landed. With the completion of asset restructuring, FAW Group has been reorganized The rhythm of the market may be accelerated.
With the completion of industrial and commercial change registration procedures, FAW Pentium sedan Co., Ltd. will become the main operator of FAW Pentium brand as a wholly-owned subsidiary of FAW shares. FAW Pentium, a passenger car brand under FAW, will further accelerate its development with the support of the group; and FAW Jiefang, a commercial vehicle brand, has successfully landed in the capital market.
FAW Pentium becomes a wholly owned subsidiary of FAW
In the management structure of FAW Group’s listed companies, FAW Pentium brand should give full information disclosure in terms of market decision-making, operation efficiency and flexibility in accordance with the requirements of listing laws and regulations, and there will be strict market constraints to quickly achieve business performance. With the asset restructuring, the independent passenger car brand Pentium of FAW Group is obviously conducive to its future market development.
FAW Pentium brand was born in 2006. As the independent passenger car brand of FAW, in 2019, FAW Pentium has a total sales volume of 120500 vehicles, a year-on-year increase of 33%. The obvious market growth can bring better market profitability, which is also conducive to FAW’s split listing. As Pentium becomes a non listed wholly-owned subsidiary of FAW, it is also conducive to FAW Group’s support for Pentium brand and more support in product technology and marketing strategy.
Some analysts believe that at present, the profitable sectors of FAW Group are mainly joint-venture passenger cars and independent commercial vehicles. With the implementation of the restructuring plan, it is conducive to improving the profitability of the independent passenger vehicle sector of FAW Group, which is crucial for the overall listing of FAW Group.
FAW Jiefang commercial vehicles become the main profit plate
As a high-quality asset of FAW, the completion of the restructuring will help to enhance the overall strength of FAW Group, especially in the commercial vehicle capital market, and greatly enhance the profitability, asset scale and capital market value of FAW Jiefang.
According to the relevant data, in 2017, 2018 and the first 10 months of 2019, FAW Jiefang commercial vehicle sector achieved 70.833 billion yuan, 72.653 billion yuan and 71.642 billion yuan respectively, and realized net profits of 2.24 billion yuan, 1.453 billion yuan and 2.466 billion yuan. In 2019, FAW Jiefang produced 369700 complete vehicles and sold 336000 vehicles, among which the sales of heavy trucks ranked first in the industry for four consecutive years.
After the listing and restructuring, FAW Jiefang can gain greater recognition and favor in the capital market, give full play to its capital advantages, improve its product technology research and development strength and market share, and form a more favorable market competition with domestic commercial vehicle listed vehicle enterprises.
With the completion of the equity arrangement of FAW Group, FAW Pentium and FAW Jiefang became independent one after another. FAW Pentium has become a wholly-owned subsidiary of FAW, which can make full use of the group’s advantages to expand the market. FAW Jiefang can give full play to the dominant position of the commercial vehicle market. This adjustment will accelerate the overall listing process of FAW Group.