Property management companies become experts in silver investment, just after earning 247 million yuan, they buy the dip with another 38 million yuan.

How can property companies accurately grasp the timing of silver investment?

21st Century Business Herald Reporter Ye Maisui

Property companies have become small experts in precious metal investments.

Recently, the Hong Kong-listed company Qifu Life Services announced further investments in precious metals. The announcement revealed that the company spent approximately HKD 43.2 million (about RMB 38 million) to acquire about 80,300 ounces (approximately 2.498 tons) of allocated silver bars, with the investment expected to be completed by March 25. Of the purchase funds, HKD 27.3 million came from previously undistributed gold sale proceeds, while the remaining HKD 10.7 million was internal company funds, requiring no additional financing. Qifu Life Services’ move can be described as “precise and ruthless.” On March 23, precious metals encountered a “black trading day,” with both gold and silver dropping to their lowest points of the year, triggering panic. However, seeking fortune in risk, while the market was stunned by the extreme performance of precious metals, some companies took action.

Profited 247 million yuan at one point

Originally a “mediocre” property company, it gained fame through precise investments in precious metals. On the evening of January 12, the Hong Kong-listed company Qifu Life Services announced that it had placed an order for 280,000 ounces (with ounces being the unit used hereafter) of silver bars, at a total cost of about RMB 162 million, expecting a profit of RMB 104 million. The company had previously issued a sale order for 400,000 ounces of silver bars on January 7, and announced the completion of the transaction and a profit of RMB 143 million on January 9.

Qifu Life Services’ silver investment began in 2020.

At the end of February 2020, the company purchased 800,000 ounces of silver bars in batches through Standard Chartered Bank in Hong Kong, with a total expenditure of RMB 103 million, averaging a cost of only RMB 128.75 per ounce.

However, the investment was not smooth sailing. In 2021, the fair value of the silver bars held by the company experienced a loss of about RMB 21.24 million, but the management did not panic. Instead, in 2022, they took the opportunity to cash out 500,000 ounces, recouping a total of RMB 79.05 million, with an average selling price of RMB 158 per ounce, initially tasting the sweetness.

As the supply and demand dynamics of the silver market changed, the company further increased its investment in July 2024, purchasing 380,000 ounces of silver bars in three batches over five days, demonstrating its firm optimism about the silver market.

“Those who can buy are apprentices, but those who can sell are masters.” Qifu Life Services made headlines with its cash-out move in January. On January 9, the company sold 400,000 ounces of silver bars for RMB 226 million, about 12.44 tons, with an average transaction price of RMB 565.5 per ounce; on January 12, it sold 280,000 ounces of silver bars for RMB 162 million, about 8.71 tons, with an average transaction price further rising to RMB 577.5 per ounce. After completing these two transactions, the company converted all of its remaining approximately 21 tons of silver bars into cash, netting a profit of RMB 247 million compared to the book value at the end of 2024, which is three times the net profit attributable to the parent company for the first half of 2025 (RMB 75.149 million), drawing significant market attention.

Qifu Life Services stated in the announcement: “Investing in undistributed silver bars is part of the Group’s financial management. Given the current market trends for undistributed silver bars, especially as the recent market price has reached a multi-year high, the directors believe that now is an appropriate time for the Group to realize part of its undistributed silver bar investment.”

The capital market quickly responded positively, and on January 12, after resuming trading, Qifu Life Services’ stock price rose throughout the day, with a single-day increase of 8.64%.

Investing 38 million again at the bottom

On March 23, international precious metals faced a “black Monday.” As some investors panicked and exited due to a dramatic drop in precious metal prices, Qifu Life Services made another bold investment at the bottom. On the evening of March 23, Qifu Life Services announced a second silver investment, stating that the company spent approximately HKD 43.2 million (about RMB 38 million) to acquire about 80,300 ounces (approximately 2.498 tons) of allocated silver bars, funded by the proceeds from the sale of undistributed gold at about RMB 27.3 million and internal resources of about RMB 10.7 million. This investment is expected to be completed by March 25.

Regarding this second investment at the bottom, Qifu Life Services provided a clear rationale in the announcement: In the current economic environment, precious metals have shown sustained appreciation potential over the long term, providing more stable returns during economic downturns, serving as a viable store of value and risk diversification tool, while reducing the exchange rate and interest rate risks associated with fixed deposits, aligning with the company’s financial management goals, aimed at safeguarding company resources to support future development.

The announcement also stated that the company had fully considered its funding needs for daily operations and capital expenditures when making this investment decision. The silver investment will not affect the company’s daily funding needs. Given the downward risk of precious metal prices, the company adheres to the principle of safeguarding all shareholders’ interests, implementing strict monitoring and making prudent decisions regarding its investment to maximize returns for shareholders.

Public information shows that Qifu Life Services is a property management company listed on the Hong Kong stock market. The company’s actual controller, chairman, and general manager is Meng Lihong, the wife of Peng Linji, the founder of Qifu Group and a real estate tycoon.

The spot price of silver this year started at USD 72.6 per ounce, subsequently peaking at USD 121.6 per ounce, with a maximum increase of over 65% during the year, briefly becoming the “best” investment in the market. However, it then fell in tandem with gold, dropping 20% on January 30. Afterward, silver entered a “monkey market” trend, but overall the focus shifted downwards. On the night of March 19, silver experienced a dramatic drop again, plummeting over 13% during the session, hitting a low of USD 65.6 per ounce. On March 23, this figure was further adjusted, falling directly to USD 60.855 per ounce, marking the lowest point of the year.

The continuous adjustments have wiped out silver’s gains for the year, even turning negative. However, as market sentiment gradually calms, the current spot price of silver has rebounded to USD 71.6 per ounce (as of 8:40 AM Beijing time).

Regarding the recent “abnormal” performance of precious metals, Wang Zheng, general manager of Shangyi Fund, believes that the most direct trigger was the Federal Reserve’s hawkish signal on March 18: maintaining interest rates at 3.5% - 3.75%, and even mentioning the possibility of further rate hikes, significantly cooling expectations for cuts in the dot plot, which pushed the dollar and US Treasury yields higher, greatly increasing the opportunity cost of holding non-yielding precious metals. At the same time, the US-Iran conflict led to soaring oil prices, exacerbating inflation concerns and further strengthening the trading logic of “higher rates for longer,” coupled with the concentration of profit-taking at earlier high levels and technical breakdowns, together causing a sharp decline in gold and silver.

Regarding why safe-haven assets have become risk assets, Wang Zheng believes that the geopolitical conflict’s safe-haven logic has been completely overshadowed by interest rate and inflation logic. The US-Iran conflict has driven up oil prices, raising inflation expectations, leading the market to bet that the Federal Reserve will find it harder to cut rates, with real interest rates rising and suppressing gold and silver; safe-haven funds preferentially flow to the more liquid dollar and US Treasury bonds, rather than gold; at the same time, funds have shifted from gold and silver to oil and energy assets that directly benefit from the conflict, resulting in gold and silver declining instead of rising against a backdrop of geopolitical tension.