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Hong Kong freight forwarder Excel Network has joined a number of companies in the container shipping market in publicly listing on the Hong Kong Stock Exchange.
Founded in 1997 by CEO Wong Tat Shing and chairman Ramthur Chim, the group has incorporated ENL Group Holdings in the Cayman Islands to apply for a listing in Hong Kong.
The listing prospectus, filed on 30 May, did not give any timeframe and fund-raising target for the IPO.
The group started out with ocean freight from Hong Kong and expanded its business to mainland China in 2005, after which it began offering warehousing, logistics, repackaging and palletising.
Currently, in China, the group has offices in Shanghai, Shenzhen, Chongqing and Guangzhou.
Excel Network’s management said that part of the IPO proceeds would go towards expanding its air freight forwarding services, including acquiring and installing cargo x-ray equipment to comply with the International Civil Aviation Organisation’s air cargo security standards.
In the year ended 31 March 2022, Excel Network’s ocean freight volumes doubled year-on-year to 26,926 teu and air freight increased by 3% to 8.93m kg. The company’s net profit trebled to $9.69m.
The strong growth in Excel Network’s ocean shipment volume was mainly due to the significant increase in orders for garments and fashion-related products, household products and furniture. There was also an increase in exports of toys and other consumer goods from China to Europe.
Management also noted the shift from air freight forwarding to ocean freight forwarding because of volatile freight rates and capacity shortages in the air cargo sector.
Riding on historically high earnings in the container sector, several companies have been turning to the stock market to raise funds. Last month, Chinese logistics operator De Well Group applied for a listing on the Hong Kong bourse. China United Lines has applied for a Hong Kong IPO, while TS Lines boss Chen Te-sheng said the company hoped to be listed in Hong Kong this year.