BRIEF: Lvji Tech to raise $19 million via rights issue at heavy discount

Online tour guide services provider Lvji Technology Holdings Inc. (1745.HK) announced on Monday it plans to raise HK$152 million ($19 million) through a 2-for-1 rights issue at HK$0.18 per share, representing a 32% discount to its previous closing price.

The company said it will use proceeds from the issue to upgrade its existing inventory of electronic guide systems, expand its electronic services outside China, acquire robotics and low-altitude aerial technology companies, purchase scenic spot operation rights, and for general working capital.

Lvji Tech’s revenue fell 10.2% to 525 million yuan last year, while its net profit plunged 43.6% to 81.85 million yuan. The company attributed the downturn to weak consumer sentiment in China that resulted in declining demand for domestic and outbound travel.

The company’s stock opened 9.43% lower on Tuesday, and closed down 21% at HK$0.209 at the midday break. The stock is down 43.5% this year.

By Lee Shih Ta

To subscribe to Bamboo Works weekly free newsletter, click here