FAST NEWS: Lygend Resources boosts investment in marine transport company
The Latest: Nickel products trader Lygend Resources & Technology Co. Ltd. (2245.HK) announced Wednesday that it has contributed a further 18.15 million yuan ($2.58 million) to its investment in MJM, a company engaged in the marine transport business in Indonesia. After the transaction, Lygend’s shareholding in MJM will remain unchanged at 49%.
Looking Up: Lygend made its original investment to take advantage of MJM’s shipping services to help reduce its operating costs and ensure continuity and flexibility in the transport of its products.
Take Note: For the six months through August this year, MJM recorded a pre-tax profit of about 5.27 million yuan. However, MJM results will not be consolidated into Lygend’s, as Lygend only holds a 49% stake in MJM.
Digging Deeper: Founded in 2009 and headquartered in the port city of Ningbo, Lygend engages in investment and trade in the nickel industry. Its businesses include nickel ore trading and shipping, smelting of nickel products and equipment manufacturing. The company was listed in Hong Kong in December 2022, raising over HK$4.6 billion ($590 million), and recorded significant revenue growth for two consecutive years afterwards. But falling nickel prices, coupled with rising interest expenses and foreign exchange losses, caused its net profit to fall by nearly 40% last year to 1.05 billion yuan.
Market Reaction: Lygend shares fell on Thursday and closed down 0.7% at HK$7.06 by the midday break. The stock now trades in the middle of its 52-week range.
Translation by A. Au
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