China’s Top HNWIs and High-Tech Private Investment Fund Manager Broad General Holding Files for Hong Kong IPO

China’s Top HNWIs and High-Tech Private Investment Fund Manager

Broad General Holding Files for Hong Kong IPO

 

[Hong Kong, 4 July 2023] – Broad General Holding Limited, a private investment fund manager focusing on high-net-worth individuals (HNWIs) in high-tech industries, announces that it has formally submitted its application form (Form A1) for listing on the Main Board of the Hong Kong Stock Exchange last Friday. With its first private equity fund filed in 2016, Broad General is a leading private investment fund manager focused on serving HNWIs and empowering high-tech companies in China. Headquartered in Hangzhou, Broad General invests primarily in the high-tech services, digital information technology, advanced manufacturing and automation, medical technology and new materials sectors.

 

In recent years, steady economic growth and the rapid development of emerging industries such as high-tech industries have given rise to a large cohort of HNWIs, which grew steadily in numbers from 1.6 million in 2017 to 2.1 million in 2021, representing a CAGR of 7.0% between 2017 and 2021. By 2026, the number of HNWIs in China is expected to reach further to 3 million. Such expansion will further drive the demand for asset management services, among which private equity is one of the fastest growing asset allocation categories. According to the China Private Equity Report published by BDA Partners in March 2023, private equity funds in China invested a total of RMB945.5 billion in 2022, accounting for about half of the total capital raised. The figures reflect that these funds will be in full swing in 2023, which will focus on investing in high-value assets, especially in technology sectors.

 

A vision of creating higher and sustainable values for families, businesses and society

 

As of 31 December 2022, in terms of AUM, Broad General was the second largest private investment fund manager in China that focuses on serving domestic HNWIs, and was one of the largest market players focused on investing in high-tech industries. With a total of 74 funds under management, Broad General has exceeded RMB9.3 billion in AUM. Nip Chun Pong, the Chief Analyst of Blackwell Global Asset Management, is impressed by the vision of Broad General, a company dedicated to providing simpler investment for entrepreneurship, greener capital and more value for society, as well as more private equity investment opportunities for HNWIs. Through its excellent asset management services, Broad General seeks to create higher and sustainable value for families, enterprises and society, thus achieving mutual benefits for all.

 

CAGR of AUM grows more than doubled

 

According to Nip, while it is true that there are few investment options for HNWIs in mainland China, investing in high-tech industries requires in-depth research and is often difficult to accomplish on one’s own. Private equity funds are therefore well placed to meet the needs of the group and enable them to enjoy the economic benefits of high-tech industries. Some of Broad General’s more well-known investments include XGIMI Technology (688696.SH), an A-share listed in March 2021; and ClouDr (09955.HK), a H-share listed in July 2022. In fact, Broad General has significantly increased in AUM from RMB100 million in 2016 to RMB9.3 billion in 2022, representing a CAGR of approximately 113%. Such growth implies a strong market recognition for its investment performance and the contribution by its unique strategy to deliver significant returns.

 

In addition to the rapid growth in fund size, the strong market acceptance is also exemplified by the highly loyal investors, which saw a robust growth in numbers from 2020 to 2023 at a CAGR of approximately 10.5%. Loyal clients started their investments as early as 2016 when the funds were first launched, bringing them up to date for over seven years of investment. More than 30% of Broad General’s clients have invested in more than one of its funds. For the years ended 31 December 2020, 2021 and 2022, repeated investments by clients accounted for 43.6%, 48.1% and 69.2% of Broad General’s financing in each year respectively.

 

Nip is bullish on the future performance of Broad General, believing that the percentage of repeated investments by clients is expected to expand further this year following the growing interest in technology development in mainland China. For the year ended 31 December 2022, the funds of Broad General recorded a strong IRR of 18.7%, despite a decline of 27.19% in the Hang Seng TECH Index and of 24.63% in the NASDAQ Golden Dragon China Index last year. This marks a remarkable achievement for Broad General of having weathered a challenging environment in technology investment last year. The IPO will be a fresh start for Broad General to further meet the investment needs of HNWIs and thus fuel the future development of high-tech industries.