China Commodity City Plans to Launch About 1 Billion Yuan Fund in Yiwu

Consumer Staples Author: EqualOcean News, Xiaoran Zhang Apr 18, 2024 02:02 PM (GMT+8)
Yiwu, Zhejiang

China Commodity City recently issued a statement revealing its plan to act as a cornerstone investor, collaborating with multiple parties including Botong Zhen Tong Management Consulting Co., Ltd., to jointly establish an overseas fund of approximately 1 billion yuan, with China Commodity City contributing 250 million yuan, accounting for about 25% of the total fund.

According to the company's previously disclosed 2023 annual report, China Commodity City achieved a record-breaking operating income of 11.3 billion yuan, representing a year-on-year growth of 48.3%, and a net profit of 2.676 billion yuan, marking a significant increase of 142.25%. The company intends to distribute cash dividends of 0.20 yuan per share to all shareholders, totaling approximately 1.097 billion yuan, accounting for 40.99% of the annual net profit. However, the first quarter report for 2024 revealed a decline in net profit to 713 million yuan, down by 41.66% year-on-year, primarily due to reduced investment income from joint ventures and asset disposal.

Despite the contraction in net profit in the first quarter of 2024, China Commodity City remains actively expanding its business. The chinagoods AI innovation platform achieved a new gross merchandise value (GMV) of 11 billion yuan in the first quarter, marking a 37.5% year-on-year increase. Meanwhile, the Yiwu Pay platform witnessed rapid growth in cross-border Renminbi transactions, with cross-border transaction volume surpassing 6.2 billion yuan in the first quarter. According to the company's plan, the GMV of the chinagoods platform in 2024 is expected to exceed 80 billion yuan, and the Yiwu Pay platform's new cross-border Renminbi payment transaction volume will reach at least 3 billion US dollars.

The establishment of the overseas fund aims to invest in high-quality enterprises in the upstream and downstream of cross-border logistics and supply chain sectors, further enhancing Yiwu's core competitiveness in cross-border logistics. This includes but is not limited to logistics/supply chain products and services, digital information platforms, SaaS, e-commerce operation services, customs clearance, and cross-border payments. The fund will provide financial support to Yiwu's cross-border enterprises, creating a superior service ecosystem for Yiwu's overseas trade through the combination of platform and capital, and enhancing the international competitiveness of enterprises.

The company stated that Yiwu, as a globally renowned hub for small commodities, holds a pivotal position in international trade. Through the establishment of the overseas fund, China Commodity City aims to consolidate and enhance Yiwu's influence in global trade, facilitate the better integration of local enterprises into the global market, and achieve leapfrog development. With the implementation and operation of the overseas fund, the company will further enhance its position in the global supply chain and achieve stable growth.