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

Chapter 120 Signing the Contract

After hanging up the phone, the dormitory was quiet for a moment.

Xia Yaozong was the first to speak: "Permira?"

"Um."

"Selling shares in Galaxy Entertainment?"

"Um."

20%?

","Um."

"What's the price?"

"They offered 0.80, but there was no negotiation."

Zhang Yixing frowned: "0.80? Today's closing price was 0.60. They want to sell it to you at a 33% premium?"

"Their cost is 8.42."

Zhang Yixing leaned back in his chair and thought for a moment.

"Why are they contacting you? You're the largest buyer in the secondary market; you bought 6500 million shares today. Do they want you to take over their positions?"

""

"Are you planning to buy it?"

Lu Chenzhou did not answer immediately.

Yang Cheng closed the book, leaned against the headboard, and spoke softly.

"Permira was acquired in October 2007 when the stock price was over 8 dollars. Now it's 0.5 dollars, meaning they've lost over 90%."

Private equity funds typically have a five-year term; from 2007 to 2012, there are still more than three years left.

But then the financial crisis hit, and the LPs wanted to redeem their shares; they couldn't wait.

He paused for a moment: "It's not that they don't have a good view of Galaxy Entertainment, it's just that their money isn't their own, and they don't care about selling their father's land."

Lu Chenzhou glanced at Yang Cheng. Of the four people in the dormitory, Yang Cheng was the least talkative.

But every time he speaks, he hits the nail on the head.

"Are you going to Hong Kong tomorrow?" Yang Cheng asked.

"Um.

""

"Be careful, Permira is the seller, you are the buyer, and they are more anxious than you are."

Lu Chenzhou nodded.

Xia Yaozong stared at him. "Aren't you afraid of buying the wrong thing?"

Lu Chenzhou was silent for a few seconds: "I'm scared, but I still have to go."

Zhang Yixing asked incredulously, "You really want to buy it?"

Lu Chenzhou replied, "It depends."

After saying that, he put his phone next to his pillow and went to wash up.

Yang Cheng picked up the book again and turned to the page he had just read.

Zhang Yixing turned back to his computer and continued to look at the post-market data.

Xia Yaozong lay back on the bed and stared at the ceiling.

The dormitory fell silent.

Lu Chenzhou came out of the bathroom and dried his hair with a towel.

Xia Yaozong leaned against the headboard, his phone screen lit up, displaying the registration information of Zhizhou Capital BJ Investment Management Co., Ltd., as well as quotation information from several public fund companies.

He handed the phone over.

"You've completed the registration of your private equity firm in mainland China. You already have enough money to buy a public fund management company. Do you still want to buy one?"

Lu Chenzhou took the phone and glanced at it.

"The one with 2.5 million, we'll sign the contract tomorrow morning."

Xia Yaozong was taken aback: "Really buying?"

"Um."

"The Shanghai Composite Index is at 1700 points now, the market has fallen so badly, and you're buying mutual funds? Do you have too much money to burn?"

Lu Chenzhou draped a towel over the back of the chair and sat down.

"I bought it precisely because it was at 1700 points."

He explained, "The application for a public offering license has to wait in line, and the approval process takes at least three months."

By the time the approval is granted, the market may have already started to recover.

Now, by acquiring a shell company, you can directly obtain a license and raise funds.

By the time the market picks up, the money will already be in place.

Zhang Yixing turned his head from in front of the computer: "You're raising funds? Didn't Zhizhou Capital just finish raising funds in Hong Kong?"

"Raising funds in mainland China to invest in A-shares."

"Right now? 1700 points? Nobody dares to buy."

Lu Chenzhou glanced at him: "Even when the index was at 1900 points on September 18th, nobody dared to buy."

Zhang Yixing opened his mouth, but no words came out.

Xia Yaozong put his phone away: "Okay, we'll sign the contract tomorrow morning. What about Permira?"

"I'm going to Hong Kong this afternoon, we'll talk after I've met them."

Yang Cheng leaned against the headboard, turned a page of his book, and spoke softly.

"How do you raise funds through public funds? If you launch your own product, nobody knows who you are. Retail investors won't recognize you, and neither will institutional investors."

Lu Chenzhou thought for a moment: "Fundraising through acquaintances is fine. It's all about fate. There's no need to make it so complicated."

"What about the commission?"

Give as much as you are entitled to.

Yang Cheng nodded and didn't ask any more questions.

Zhang Yixing turned back to his computer and continued to look at the post-market data.

Xia Yaozong lay back on the bed, staring at the ceiling. This fundraising was far too casual.

Lu Chenzhou turned off the light and lay down.

We'll sign the contract tomorrow morning to buy a publicly traded shell company.

I'm flying to Hong Kong this afternoon to see Permira.

Two things, one in Beijing and one in Hong Kong.

Nobody dared to buy at 1700 points, but he did.

It wasn't because he was bold, but because he knew that below 2000 points was the bottom.

He said this at a salon on September 17th. Now the index is at 1700 points, which is 200 points lower than then.

Nobody believed it then, and probably nobody believes it now either.

But it doesn't matter, believe it or not, the market decides.

He took out his phone and sent a message in the investment group: "Zhizhou Capital BJ Investment Co., Ltd. will start fundraising tomorrow, 100..."

Investments start at 10,000 yuan, A-shares, mutual funds contracts will be signed tomorrow morning. Those interested in buying mutual funds can start preparing now.

He took out his phone and sent a message to each of the two groups.

The investment group (Zhizhou Capital Hong Kong investors) reported: "Zhizhou Capital BJ Investment Co., Ltd. has been registered, and the public offering shell has been signed. Existing products are still available, with a QDII quota of US$3 million. Those interested in investing in A-shares and Hong Kong stocks can subscribe directly. Private placements with a minimum investment of 100 million RMB have also been launched simultaneously."

Alumni group: "ZhiZhou Capital's BJ public offering shell has been signed. Existing products are still available, with a QDII quota of $3 million, which can be directly subscribed to, and a private equity quota of 100..."

Investment starts at 10,000. Those interested can follow.

The moment the message was sent, both groups exploded simultaneously.

Investment group (Hong Kong private equity investors): "Brother Lu, private equity investment starting from 100 million? A-shares?"

"The index is at 1700 points now, and you're telling us to buy A-shares?"

"Brother Lu, are you drunk?"

The messages were scrolling by quickly, but Lu Chenzhou didn't reply.

"I'll invest 100 million. The payment will be made tomorrow."

The group chat was silent for a moment.

"I'll invest too, let's make it 100 million."

"Brother Lu, I don't have much money, but I'll take 50. I'll find someone to raise the rest."

The group chat was silent for a few seconds.

"Are you guys crazy? The index is at 1700 points now, look how badly the A-shares have fallen! You're still investing?"

"When Brother Lu called for buying the dip at 1900 points on September 18th, you guys said he was crazy."

"That's Hong Kong stocks, this is A-shares. How can A-shares and Hong Kong stocks be the same?"

"When Brother Lu bought Hong Kong stocks, you said he was crazy. He made money. When Brother Lu bought A-shares, you still said he was crazy. Think about it yourselves, who's the crazy one?"

No one objected anymore.

"I'll go with 100."

"I'll go with 50."

"I'll go with 200."

"I'll go with 500."

Messages kept coming in.

Alumni Group (Public Fund Followers):

The response was even more enthusiastic. The threshold for public offerings is low, and ordinary people can also invest. This is the first time that most people have had the opportunity to buy with Lu Chenzhou.

"Public funds? QDII? Can they invest overseas?"

"What's the minimum investment amount? No specific figure was given, but generally, you can buy a mutual fund for around 1000 yuan, right?"

"1000 yuan? Really? I'll bet!"

"When Brother Lu said 'low threshold,' he was probably referring to the standard for ordinary public funds."

"I can invest. My monthly salary is 4000, can I invest 2000?"

"You invest 2000, I'll invest 5000. Following Brother Lu is better than buying blindly on your own."

"Don't rush, wait for his announcement and the product to be released before buying."

When will the announcement be released?

"We'll sign the contract tomorrow; it should be done soon."

"I've been waiting, I've been waiting for two months, from September 18th until now, and finally the A-shares have arrived."

"Me too! I didn't lend him money when he asked on September 18th, and I regretted it for two months. I can't miss this opportunity again."

"Public offerings are publicly issued, so there's no need to rush to buy them, right?"

"It's hard to say. With Brother Lu's reputation, the product might sell out very quickly once it's released."

"Then I need to prepare the money."

"I'm ready too."

Someone posted screenshots of both groups on Tsinghua University's BBS with the title: "[Breaking News] Leverage Guru Lu Chenzhou is going to launch a public fund in the A-share market. Private funds start at 100 million yuan, while public funds have lower entry barriers!"

The post received over a thousand replies the moment it was published.

"A private equity fund of 100 million? I can't afford that. What about public funds? How much do public funds cost?"

"The public fund didn't give a specific number, but you can usually buy it for 1000 yuan."

"1000 yuan? I can invest then."

"Are you crazy? The A-share market is at 1700 points right now, and you're going to buy?"

"When Brother Lu called for buying the dip at 1900 points on September 18th, you also said he was crazy. He made money. He's going to buy the dip in A-shares, and you're still hesitating?"

Can the A-share market be compared to this?

"He made money in Hong Kong stocks, why can't he make money in A-shares?"

"Didn't he make his money by shorting Hong Kong stocks? Can you short sell A-shares?"

"He shorted because Hong Kong stocks can be shorted, but A-shares cannot, so he went long. On September 18th, he went long on CITIC Securities and made 95,000 in one day. Have you forgotten?"

"Holy crap, so he's really going to buy the dip in A-shares?"

"The announcement is very clear: Zhizhou Capital (BJ) will sign a public fund shell company tomorrow, and the public fund product will be launched soon. What do you think is their purpose in buying the shell company?"

"In order to buy A-shares at the bottom."

"Then what are you still hesitating for?"

"I'll take it, 1000 yuan."

"Me too, 2000."

"Me and 5000."

"I'll go with 1."

"Calm down, let's wait until the product comes out before we talk about it."

"What are you waiting for? I waited on September 18th, but I missed the bus. I'm not waiting this time."

Messages are also popping up in the Renmin University alumni group.

Guo Fansheng posted: "Lu Chenzhou is going to launch an A-share public fund? I'll invest 1000 million in the private fund and also subscribe to the public fund. What's the limit?"

Dai Zhikang followed suit: "I'll subscribe to the public fund as well as the private fund, which is worth 500 million."

Qiu Guogen summed up three words: "2000 million for private placement, and the same amount for public offering."

The group chat was silent for a moment.

"Mr. Qiu, didn't you just invest in the Hong Kong side?"

"Hong Kong is Hong Kong, and A-shares are A-shares. If he dares to enter the market at this point, I dare to follow. The threshold for public funds is low, so I will subscribe to less and give some quota to ordinary people."

"What about Professor Ren? Is Professor Ren going to submit his application?"

Ren Huaixiu replied in the group chat: "Let me take another look."

Department of Finance

Zhou Xingbang sat in his office, with posts from Baidu Tieba on his computer screen.

He's been watching for almost ten minutes now.

My phone vibrated; it was a message from Wang Jianguo: "Yuan Zhou, is your student Lu Chenzhou going to start a mutual fund on the A-share market?"

Zhou Xingbang smiled wryly and replied, "The official announcement hasn't been released yet, but he's already mentioned it in the group: private funds start at 100 million yuan, while public funds have a lower threshold."

"The A-share market is currently at 1700 points; is he going to enter the market?"

"He also entered the market at 1900 points on September 18th."

There was a few seconds of silence on the other end of the phone.

"This student is incredibly bold."

302 Suxiang.

Lu Chenzhou was already asleep.

Xia Yaozong lay on the bed, staring at the ceiling, his phone screen still lit up.

The messages in the investment group were still scrolling by, but he no longer read them.

He was pondering a question: If the index reaches 1700 points and Lu Chenzhou enters the market, should he follow suit?

He turned over and pulled the blanket over his head.

To follow or not to follow is foolish.

Zhang Yixing sat in front of the computer, not asleep.

He was looking at the after-hours data for A-shares: the Shanghai Composite Index was at 1706 points, with a turnover of 328 billion yuan. Low volume. Low prices.

He looked at the number and recalled Lu Chenzhou's words: "Below 2000 points is the bottom."

He said it at the salon on September 17th. The whole room burst into laughter.

It's at 1700 points now, 200 points lower than then. Nobody's laughing.

Because the person who was laughing can no longer laugh.

He turned off the computer and got into bed.

Tomorrow, Lu Chenzhou is going to sign the contract for the public offering shell company.

Then raise funds, and then buy A-shares.

Yang Cheng leaned against the headboard, holding the book in his hand, but didn't turn the page for a long time.

He was thinking about the old saying Lu Chenzhou had mentioned: "Fundraising through acquaintances is fine; it's all about covering up the difference."

The explanation of "covering up" is too arbitrary.

But upon closer reflection, it wasn't arbitrary.

Mutual funds require commissions and go through procedures when they are sold through securities firms.

Lu Chenzhou refused; he sought out acquaintances and trusted individuals.

找9月18号借他钱的人、9月23号投他募资的人、10月在香港跟他买的人。

Those people didn't vote because he issued an announcement, but because they trusted him.

I trusted him, so I voted.

It's not about investing in the product, it's about investing in the person.

Yang Cheng closed the book, turned off the light, and realized that the two words "cover up the points" were more effective than any fundraising prospectus.

That night, the lights on the Renmin University campus stayed on very late.

Some people are calculating how much money they can raise, some are going through their chat history from September 18th, some are posting on Baidu Tieba, and some are lurking in investment groups.

Public funds have low entry barriers, so ordinary people can also invest.

This is the first time most people have had the opportunity to buy A-shares following Lu Chenzhou's lead.

No one knocked on Su Xiang's door in room 302. Everyone knew that Lu Chenzhou was already asleep.

He can sleep, but others can't.