The Zhitong Finance App learned that Everbright Environment (00257) was higher in the intraday period. As of press release, it was up 3.31% to HK$5.15, with a turnover of HK$664.741 million.
According to the news, Everbright Environment announced on November 6 that on November 6, the board of directors approved the issuance of no more than 800 million RMB shares in accordance with a special authorization proposal, accounting for about 11.52% of the expanded share capital. Assuming that they all exercise the right to over-allot and issue no more than 920 million A shares, the proposed capital amount is 8 billion yuan. The shares will be listed on the main board of the Shenzhen Stock Exchange. The proposal is subject to shareholders' approval.
Bank of America Securities pointed out that as a state-owned enterprise, Everbright Environmental must issue A shares at a rate higher than 1 times the market account rate, with an estimated book value of HK$8.9 per share at the end of 2026. The bank understands that mainland investors require a dividend rate of more than 4%, which means that the dividend per share needs to rise to about HK$0.37, an increase of 38% over the previous year, implying a dividend rate of 7.5%. The bank believes that the increase in dividend per share will dilute earnings per share by about 9%, and expects the dividend level to remain at least unchanged in the future. To achieve a dividend payout of HK$0.37 per share after expanding the share capital, a dividend ratio of about 55% may be required.