KVB shares remain below their July IPO price
Hong Kong listed retail forex broker KVB Kunlun (HKG:8077) has announced that it has obtained permission from Chinese authorities to open an office in mainland China. The Zhuhai City Hengqin New District Management Committee and Executive Services Promotional Bureau have successfully approved the company’s application for setting up their subsidiary in the southern city of Zhuhai.
The British Virgin Islands registered and Hong Kong based company seems to be embarking on mainland expansion and says in its statement on the matter that they are aiming at providing financial services in mainland China. Share prices have not reacted much to the news and remain well below KVB Kunlun’s IPO price in July.
The Hong Kong listed brokerage has been losing ground as demonstrated in its Q3 earnings report and despite announcing that it will start quarterly dividend payments, the event has not been substantial enough to provide further impetus to the stock. A single quarter report doesn’t reflect the long term prospects for the company of course. Share prices have remained fairly flat since the IPO, gravitating around 0.40 HKD.
The mainland China expansion might just be the right thing to do when it comes to fresh client base. As the Chinese authorities have promised to continue their track on liberalizing the economy, if KVB Kunlun (HKG:8077) manages to play this hand well, it could reap substantial benefits from Chinese mainland operations.
For the full press release on KVB Kunlun’s mainland expansion click here.
For more on the global Forex industry see the LeapRate-Dow Jones Forex Industry Report.