CHOW TAI FOOK (01929.HK)  -0.020 (-0.147%)    Short selling $55.72M; Ratio 38.886%   announced the issuance of convertible bonds (CB) to raise around HKD8.8 billion alongside a share repurchase, according to a report from Daiwa.

After adjusting for the share repurchase, the net equity dilution rate will be 3.7%, and the coupon rate as low as 0.375% will save 100-200 bps compared to CHOW TAI FOOK's existing financing costs, which can effectively reduce financing costs.

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Although CHOW TAI FOOK has strong free cash flow and needs not to issue debt, Daiwa believes that taking advantage of the low-interest long-term financing window will help drive its business transformation. With the conversion period set for three years later, the share repurchase and interest savings will boost EPS growth in the short term. Consequently, the broker kept a Buy rating on the group.
(HK stocks quote is delayed for at least 15 mins.Short Selling Data as at 2025-07-07 16:25.)