Becoming the King of Bottom Fishing After Going All-In on A-Shares

Chapter 111: Holding Up a Sign

Hong Kong stocks opened at 9:30 a.m.

The Hang Seng Index opened more than 600 points higher, around 13500 points, and then surged.

On the order book, buy orders poured in like a tidal wave.

It wasn't a medium-sized order of a few hundred thousand shares, but a large order of several million shares.

It's not just one or two institutions buying; everyone is buying.

Foreign investors, QFIIs, retail investors, and funds—everyone is scrambling to buy shares.

The short sellers are dead.

I closed out all my short positions yesterday.

There were no sell orders on the order book today, only buy orders.

The stock price soared straight up like a kite with a broken string.

中国建材开盘2.80，瞬间沖高到3.00、3.20、3.40、3.60、3.80..

"It's 3.80 now!" Zhang Yixing's voice cracked. "Building materials have gone up to 3.80."

Xia Yaozong stood up from his chair, staring at the screen with his mouth agape, unable to close it for a long time.

Lu Chenzhou remained silent.

He stared at the betting odds, his gaze lingering on the intraday chart of China National Building Materials for a few seconds before looking away.

3.80 is not the end point, but it will not be today's closing price either.

Wen Zhiyu stood by the window, her fingers flying across her notebook as she jotted down each number.

Her fingers were trembling, not from nervousness, but from excitement.

她从2.80开始记，2.80、3.00、3.20、3.40、3.60、3.80。

She recorded every single detail, and each entry refreshed her understanding.

At 9:40 a.m. in Goldman Sachs' Asian trading room, Cheng Jiajun stood at the door of Wei Zhexuan's office, clutching today's pre-market data in his hand, his face pale.

"Boss, China National Building Materials is at 3.80, a 90% increase."

China Construction Bank (CCB) rose 20% to 3.88.

ICBC shares rose 13.5% to 3.70.

Bank of China 2.30, up 14%.

Shenhua rose 20% to 14.02.

Conch Cement rose 33% to 24.15.

Wei Zhexuan sat at his desk, with a chart of Hong Kong stocks' intraday price movements on the screen in front of him.

He neither spoke nor moved.

His expression was calm, but those who knew him well knew that this calm was more terrifying than rage.

"Our empty positions..." Cheng Jiajun asked cautiously.

"We cleared everything yesterday," Wei Zhexuan said calmly. "How much it goes up today is none of our business."

Cheng Jiajun opened his mouth as if to say something, but nothing came out.

Wei Zhexuan stared at the straight upward line on the screen and remained silent for a long time.

Then he said, "He won."

It's not "we lost", it's "he won".

Cheng Jiajun knew the difference between these words.

The former is resentment, the latter is acceptance.

At 10 a.m., the Hang Seng Index broke through 14000 points.

China National Building Materials (CNBM) is fluctuating at a high level around 3.80, with sell orders starting to appear on the order book.

They're not short sellers, they're just short-term profit-takers.

Some people started selling around 3.80, but the buying pressure was stronger.

The stock price fluctuated between 3.70 and 3.80.

China Construction Bank rose to 3.88 before falling slightly and stabilizing around 3.79.

The Industrial and Commercial Bank of China (ICBC) peaked at 3.70 and then fell back to 3.65.

Bank of China peaked at 2.30 and then fell back to 2.27.

China Shenhua peaked at 14.02 and then fell back to 13.40.

Conch Cement peaked at 24.15 and then fell back to 24.00.

Zhang Yixing stared at the betting odds: "Some people are selling, but there are even more people buying."

Xia Yaozong leaned back in his chair: "With the market like this today, anyone who sells is a fool."

Lu Chenzhou didn't speak. He stared at the screen, his fingers resting on the mouse, motionless.

Wen Zhiyu stood next to him and noticed that his gaze kept switching back and forth between bank stocks and Shenhua and Conch stocks.

Her fingers unconsciously tightened around the notebook; she had seen that look before.

This was the look in his eyes before he sold all his shares in CITIC Securities on September 26.

10:20.

Lu Chenzhou's fingers moved.

Instead of taking his time as usual, he directly opened the China Construction Bank's holdings interface.

18867.92 shares, cost price 2.65, current price 3.79, unrealized profit 2.15 million.

His fingers paused on the keyboard for a second before typing.

Sold, all of it.

Switch to ICBC and sell all shares.

Switch to Bank of China and sell all shares.

In three transactions, which took less than ten seconds, approximately HK$19 billion was returned to the account.

Room 608 was completely silent.

Xia Yaozong slowly sat up straight in his chair, his voice low: "Brother Lu, you sold all your bank stocks?"

Lu Chenzhou did not answer. He switched to the holdings page of China Shenhua, then to Conch Cement, and then to China National Building Material.

He didn't sell a single one of the three stocks.

"What happens after you sell it? Where do you put the money?" Xia Yaozong asked.

Lu Chenzhou stared at the betting odds and remained silent for a few seconds.

Then he spoke, his voice not loud, but every word was clear.

What is the total share capital of Shenhua Group?

Zhang Yixing was stunned for a moment, then immediately switched to the profile page to check.

"China Shenhua H shares, with a total share capital of approximately 33.98 billion shares."

"Where's the conch shell?"

"Anhui Conch Cement (H shares) has a total share capital of approximately 4.33 million shares."

"What about the building materials?"

"China National Building Material (H shares) has a total share capital of approximately 9.02 million shares."

Lu Chenzhou nodded.

"The 5% threshold for disclosure of shareholdings is approximately 1.7 million shares for Shenhua, approximately 2165 million shares for Conch Cement, and approximately 4510 million shares for Building Materials."

He paused, glancing at his holdings of 11250 million shares in building materials.

"Building materials have already exceeded the limit; they were already oversubscribed when we started building our positions on October 28th."

1.125 million shares, accounting for 12.47%.

According to the Hong Kong Stock Exchange's regulations, disclosure must be made within three business days.

Today is October 30th, there's still time.

Zhang Yixing frowned slightly: "So what are you planning to do? Reduce your holdings to below 5%?"

Wen Zhiyu also looked at him: "If it's reduced to 4.99%, is disclosure still required?"

Lu Chenzhou picked up his water glass and took a sip: "Yes, it is necessary. The disclosure was triggered when it first reached 5%."

Regardless of whether the position is reduced later, the fact that it dropped by 12.47% has already occurred, and reducing the position cannot erase history.

他放下水杯：「而且，从12.47%减到4.99%，跨越了12%、11%、10%、9%、8%、7%、

6%, 5%, and other integer percentage points must be disclosed for each integer point.

A significant reduction in holdings can be explained in the same notice, but it still needs to be disclosed.

Both reducing the stake to 4.99% and holding 12.47% require issuing announcements and providing explanations.

The only difference is that you won't be locked up for six months after reducing your holdings.

Xia Yaozong leaned back in his chair: "So, what's your choice?"

Lu Chenzhou remained silent for a few seconds.

"No reduction."

"Why?" Zhang Yixing asked.

"Because the fundamentals of building materials have not changed, with a cost of 1.6 and a current price of 3.7, there is still room for a reasonable valuation of 5-6. Since we are optimistic about it, we are not afraid of being locked in."

The announcement will be issued as scheduled, the lock-up period will be observed, what can be saved by reducing the position to 4.99%? One lock-up period will be saved.

But I didn't buy the building materials to save on the lock-in period; I just felt they were worth the price.

Wen Zhiyu stared at him for two seconds.

"When you established your position on October 28th, didn't you consider controlling your position size?"

"I thought about it," Lu Chenzhou said, "but at the time I only had one thought: to buy enough."

"How much do you need to buy?"

"The reasonable valuation for building materials is HK$5-6. With a cost of HK$1.6, if it rises to HK$5-6, it's a three-fold increase. If I want to capture this part of the fish, I can't worry about position size."

Zhang Yixing leaned back in his chair and sighed.

"So you never intended to avoid the sign-holding line from the beginning, you just didn't say so beforehand."

Lu Chenzhou did not deny it. He stared at the betting odds and remained silent for a few seconds.

"Shenhua only reached the threshold for disclosure of shareholding changes with 1.7 million shares, while I currently only have 1902 million shares, so there is a lot of room for growth."

Conch Cement has reached the threshold for mandatory disclosure of shareholdings with 2165 million shares. I currently only have 1052 million shares, so there is still room for the value to double.

No more building materials needed; we've already exceeded the limit. Adding more would just cause trouble for ourselves.

But that won't diminish our confidence; since we're optimistic, we're not afraid of being locked in.

He put down his water glass and placed his finger on the mouse.

"Let's begin."

Buy China Shenhua at an average price of 13.42, purchase 1.5 million shares, transaction completed.

On the order book, buy orders swept upwards in a straight line, pushing the stock price from 13.40 to 13.55.

Zhang Yixing's voice was trembling: "Brother Lu, Shenhua has 1.5 million shares, plus the original 1902 million shares, for a total of 1.69 million shares."

Shenhua's total H-share capital is 33.98 billion shares, with 1.69 million shares accounting for 4.97%.

It's only 0.03% away from the 5% threshold for disclosure, approximately 100 million shares.

"That's enough," Lu Chenzhou said. "Leave some space so as not to trigger a protest."

He switched to Conch Cement, buying 1100 million shares at an average price of 24.00. The transaction was completed, and the share price rose from 24.00 to 24.20.

0

Wen Zhiyu quickly jotted down notes in his notebook: Conch Cement, originally 1052 million shares, plus 1100 million shares, totaling 2152 million shares.

海螺H股总股本4.33亿股，2152万股占比4.97%，离5%的举牌线只差0.03%，约13万股。

"The conch shell is also stuck at 4.97%," Wen Zhiyu said.

"Hmm," Lu Chenzhou said, "The building materials have already exceeded the limit, and Conch and Shenhua cannot exceed it any further."

All three are raising their placards; the announcement won't look good.

Building materials companies are about to issue announcements; Conch Cement and Shenhua Group will cut costs wherever possible.

Xia Yaozong leaned back in his chair and let out a long sigh: "Shenhua 1.69 million shares, accounting for 4.97%."

2152 million shares of Conch Cement, accounting for 4.97%.

Building materials accounted for 1.125 million shares, or 12.47%.

"Brother Lu, you have two signs stuck below the line, and one over the line."

Lu Chenzhou closed his laptop, picked up his water glass, and took a sip.

"It's not a card, it's been calculated."

Zhang Yixing stared at the transaction records on the screen, his mind racing.

The sale of bank stocks brought in approximately 19 billion, which, combined with the existing cash on hand, brings the total funds to approximately 29 billion.

Purchased 1.5 million shares of Shenhua (approximately 20 billion yuan) and 1100 million shares of Conch (approximately 2.65 million yuan).

The total purchase amounted to approximately 22.65 billion. The company still has approximately 6.35 million in cash remaining in its accounts.

"Why not buy them all?" Zhang Yixing asked.

"Leave some room for maneuver," Lu Chenzhou said. "In case we need to adjust our portfolio, we need to have cash on hand. Besides, Conch Cement and Shenhua Energy are both below the threshold for mandatory disclosure of shareholdings, so we can't buy any more; otherwise, we'll exceed the limit."

At midday closing, the Hang Seng Index closed at 13986 points, up 1283 points, or 10.1%, with half-day turnover exceeding HK$500 billion.

Wen Zhiyu recorded the midday closing data in his notebook: Building Materials 3.70, Shenhua 13.40, Conch Cement 24.00.

She closed her notebook and looked at Lu Chenzhou.

Will the price continue to rise this afternoon?

"There won't be a big surge," Lu Chenzhou said. "The market has already released its emotions this morning, and it will most likely trade sideways this afternoon."

"So, are you going to do it this afternoon?"

"It depends."

He stood up and picked up the insulated bag on the table: "Let's eat."

At noon, on a bench at the entrance of the science park.

Lu Chenzhou and Wen Zhiyu sat side by side, each with a boxed lunch in front of them.

Wen Zhiyu brought him a completely vegetarian meal today: stir-fried broccoli, scrambled eggs with tomatoes, a poached egg, and a serving of rice. Her own portion included braised pork and garlic-flavored greens.

"Why did you suddenly change your portfolio today?" Wen Zhiyu picked up a piece of braised pork and placed it in Lu Chenzhou's lunchbox.

Lu Chenzhou glanced at the piece of meat and ate it.

"It wasn't sudden. I was thinking about it yesterday, and once the market opened today and it was confirmed, I took action."

"Confirm what?"

"The short sellers are dead," Lu Chenzhou said. "There are no sell orders on the order book today, only buy orders."

The market has reversed.

After a reversal, buy the stock with the greatest potential for growth.

The reason why bank stocks are rising slowly is not because they are bad, but because their market capitalization is too large.

Shenhua, Conch, and building materials companies have smaller market capitalizations than bank stocks, but their price volatility is higher.

He picked up a piece of broccoli and slowly chewed it.

"The building materials sector has already exceeded the threshold for disclosure, but I will not reduce my stake."

If they don't reduce the number, they'll have to issue an announcement and be locked out for six months.

But I'm optimistic about it and I'm not afraid of the lock.

Shenhua and Conch still have room to grow, so all the money from bank stocks is being used to buy them, keeping them below the threshold for mandatory disclosure.

Wen Zhiyu looked at him: "Aren't you afraid that Shenhua and Hailuo will also surpass them?"

"No, I've been keeping an eye on it."

Wen Zhiyu stared at him for two seconds, then smiled.

Lu Chenzhou lowered his head and continued eating.

Hong Kong stocks continued to rise in the afternoon after the market opened, but the gains narrowed.

China National Building Materials fluctuated narrowly around 3.70, neither pushing it to 3.80 nor falling back.

China Shenhua (13.40) and Conch Cement (24.00) are both trading sideways at high levels.

Lu Chenzhou did not make any moves all afternoon.

He sat in front of the computer, looking at the betting odds, occasionally taking a sip of water from his glass, and occasionally exchanging a few words with Xia Yaozong.

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