[HK IPO] Brief Review of Impression Da Hong Pao, Nanhua Futures, and Xidi Smart Driving (with Good News)

Last month when there wasn't a single new stock for half a day, I felt uneasy inside, guessing they'd all pile up and launch together in December.

Today there are 4 new stocks, plus 2 from yesterday, making 6 IPOs in total. For other analysts, the sky must have fallen.

But I'm different! I've already reviewed over half of them when screening for private placements before, hahaha. So, hard work does pay off~

Impression Dahongpao:

Let's talk about Dahongpao first—3,610 lots, very limited supply.

We have solid channels for private placements on this stock, and many fans have already signed up to participate.

But then we encountered Xiaomian, Tianyu Semiconductor, and Naxinwei breaking three times in a row, plus Haiwei's stock rising in the grey market but falling on the first day. We believe market sentiment may have shifted, with year-end liquidity tightening and risks increasing, so we ultimately gave up.

But note: whether to take a private placement and whether to subscribe publicly are two different logics. Private placements are high-risk, high-reward investments—besides fundamentals and valuation, you must consider exit strategies. For example, if you take $5M worth of stock and it drops just 5%, that's a $250K loss. But for public subscriptions, even if you get allocated tens of thousands, a 10% drop only means a few thousand in losses—relatively controllable risk.

So, position size and win rate are directly proportional. For our past private placement projects, except for Geek+ and Sanhua Intelligent Control, which saw slight breaks in the grey market (but had solid fundamentals, so we held and they later rose nicely), all others rose in the grey market. We generally abandon private placements with win rates below 80%, while public subscriptions depend more on risk-reward ratios.

So, should we subscribe to Dahongpao? Let's take a look.

The company's business is quite simple—its main revenue comes from performance tickets, with Zhang Yimou as a co-director for its flagship show, which is a good gimmick. It also has supporting services like snack streets and hotels.

During the pandemic, the company was under pressure, but it rebounded quickly after reopening in 2023, followed by a slight decline—a normal correction after revenge spending. In H1 2025, net profit halved, mainly because the new show "Moon Over Wuyi" was still in the production ramp-up phase. During the roadshow, I asked—this project has gradually started turning a profit.

The company's future expansion plan is to acquire and integrate underperforming entertainment projects nationwide. According to the company, its project management is a core strength, with excellent cost control and an ability to identify and monetize potential projects.

From 2023-24, gross margins hovered around 55% (dropping to 42.5% in 2025 due to "Moon Over Wuyi"), placing it in the upper tier of the industry.

Valuation-wise, this pricing at ¥600M represents a 40-50% discount to A-share peer Songcheng Performance in terms of PE and PS, which is reasonable. It's listed on the New Third Board with a current valuation of ¥360M, so a 50% premium for a Hong Kong listing isn't a big issue—Xunzhong Communication's HK market cap is over twice its New Third Board valuation.

IPO Rating: ★★★~★★★★

Nanhua Futures:

Nanhua Futures' fundamentals are actually decent—revenue has grown yearly (slight dip in 2025), with a net margin of 37.41%, surpassing most futures peers. It has an AA rating, high and fast-growing overseas exposure, and ranked #1 among domestic futures firms by 2024 revenue.

But I'm not subscribing.

Why? Take a look at the table below (Nanhua Futures and Hongye Futures are A+H, while Yongan Futures is H-share only).

The table shows huge PE disparities. For PS, the lower pricing is okay, while the upper range is reasonable but slightly high. The key is the discount rate—A+H peers average a 67.87% discount, while even Nanhua's lower pricing only offers a 33.6% discount, with the upper range at just 11.6%.

Add the recent weak A+H sentiment—would you touch this discount rate?

Also, rumors say this company has some shady moves—DM me for details (not posting publicly for legal reasons).

IPO Rating: ★★~★★★

CIDI:

Reviewed this earlier—copying over for convenience.

1. Controlled by Li Zexiang, "Godfather of DJI," giving it celebrity appeal;

2. Rapid revenue growth—¥80M in 2021, ¥480M in H1 2025, full-year estimate of ¥1B, overtaking BoLeiton;

3. Still loss-making, but compared to peer BoLeiton, it has higher R&D spend. Excluding R&D, it turned profitable in 2024, while BoLeiton (with under ¥100M annual R&D) remains unprofitable even after adjustments;

4. From Feb 2021 to Feb 2022, it completed 4 small-but-frequent equity raises, quadrupling its valuation. Pre-IPO in 2024, the last round hit ¥9B to meet Chapter 18C requirements—valuation may be inflated;

5. 18.6x PS vs. BoLeiton's 13x—while fundamentals are slightly better, it's still overpriced;

6. In 2025, it recognized ¥56.9M in accounts receivable impairments, with post-impairment receivables over 3 years old still at ¥9.33M, nearly 4x 2023 levels. Fast revenue growth may stem from aggressive revenue recognition policies;

7. Its autonomous mining truck solution leads with just ¥250M (40% share), but the market is tiny. Relying on V2X limits it to closed scenarios, making it inherently less versatile than general-purpose autonomous players like Pony, thus more prone to bottlenecks;

Initial plans were for a ¥12B offering, but it ended up ¥500M cheaper—likely a concession. Combined with recent autonomous stock performances (Pony and WeRide in the US mostly back to IPO prices, BoLeiton also plummeted), market enthusiasm for autonomous stocks has cooled. Overall, risks may be non-trivial—subscription depends on margin multiples.

IPO Rating: ★★★~★★★★

$IMPRESSION DHP(02695.HK) $NANHUA FUTURES(02691.HK) $CIDI(03881.HK)