Kuaishou to raise $5.4b from HK public offering

2021-08-21 00:00 233 View

Kuaishou Technology said on Tuesday that it plans to raise as much as HK$42 billion ($5.42 billion) via its initial public offering on the Hong Kong bourse, as the short video company is speeding up monetization efforts amid rising competition from its peer Douyin, an app developed by Beijing Byte-Dance Technology.

Kuaishou has priced its IPO on the Hong Kong stock exchange, and will issue 365.2 million shares each priced between HK$105 and HK$115, according to a prospectus released by the company.

The IPO will value the firm at between $55.6 billion and $60 billion, but the valuation may reach as much as $61.7 billion under the green shoe option, or over-allotment, which allows companies to issue more shares when there is greater demand from participants during the initial offering.

The proceeds raised from the IPO will be used in enhancing the company"s ecosystem, strengthening research and development and technological capabilities, as well as acquisitions or investments in products, services and businesses in areas such as content, social entertainment and software, Kuaishou said.

Tencent has a 21.6 percent stake in Kuaishou. Ten shareholders, including Capital Group Funds, Aranda Investments, the GIC, Invesco, Fidelity International, BlackRock, CPP Investments, Sunny Festive, MSIM and ADIA, have become cornerstone investors in Kuaishou, the term sheet said. Morgan Stanley Asia Ltd, Merrill Lynch Far East Ltd and China Renaissance Securities (Hong Kong) Ltd are the joint sponsors.

Jiang Han, a senior researcher at market consultancy Pangoal, said Kuaishou is accelerating its commercialization push by tapping into the burgeoning livestreaming e-commerce segment, which has gained traction in China since the outbreak of COVID-19, in a bid to diversify its business portfolio and compete with Douyin.

Total revenue of Kuaishou increased from 8.3 billion yuan ($1.28 billion) in 2017 to 39.1 billion yuan in 2019. The figure rose 49 percent on a yearly basis to 40.7 billion yuan in the first nine months of 2020.

The company monetizes primarily through the sale of virtual items, provision of various forms of online marketing services, and commissions from e-commerce sales on the platform. It is actively developing additional monetization opportunities to diversify revenue streams through online games, online knowledge-sharing and other products and services.

There were 305 million average daily active users and 769 million average monthly active users of Kuaishou"s apps and mini programs in China during the first nine months of last year. It has invested heavily in data and technology infrastructure, with over 6,500 research and development employees as of Sept 30.

Thomas Chong, an equity analyst at Jefferies, said he expected short-form videos to become a key topic of discussion in the entertainment sector, given the huge user base, time spent and monetization potential.

More Chinese mainland investors will be able to make investments and get dividends from enterprises that are listed in Hong Kong, which has opened its arms to fast-growing technology companies, said Shen Meng, director of boutique investment bank Chanson& Co.

Shen said Kuaishou has taken the lead in exploring the monetization model for the short video industry, and made breakthroughs in profitability.

Related content
  • The Chinese mainland stock market remains "very attractive" for global investors over the long term, although a stretched valuation has magnified the volatility of A shares, a leading investment company said.Wang Qian, Asia-Pacific chief economist with the US-based Vanguard Investment Strategy Group and global head of Vanguard Capital Markets Model, said the forecast is based on growth outlook and diversification benefits of the A-share market.Wang"s observations come at a time when the A-share
  • New disclosure norms adopted by the United States" securities regulator may prompt the listed Chinese mainland companies return to Chinese bourses, said experts.The US Securities and Exchange Commission said on Wednesday that it has adopted interim final amendments to implement the disclosure requirements under the Holding Foreign Companies Accountable Act which require firms to establish that they are not owned or controlled by a foreign government entity. These companies are also required to d
  • Hywin Holdings, which provides wealth management services in China, on Friday started trading on the Nasdaq.The company, trading under the ticker symbol of "HYW," priced its initial public offering of 3,000,000 American depositary shares (ADSs) at 10 U.S. dollars per ADS.Each ADS represents two Class A ordinary shares of the company.Founded in 2006, the Shanghai-based company provides wealth management services, insurance brokerage services, and asset management services to its clients, and its
  • The country"s long-term goal to achieve carbon neutrality has been mirrored in the A-share market performance, with stock prices of carbon neutrality-related companies rising by an average 4.07 percent on Monday, while the benchmark Shanghai Composite Index gained 1.14 percent to close at 3443.44 points.Prices of carbon neutrality-related Shenzhen Energy Corp, Jilin Electric Power Co Ltd and Beijing Jingyuntong Technology Co Ltd increased by the daily limit of 10 percent. Steelmaker Beijing Shou
  • China"s National Equities Exchange and Quotations (NEEQ), also known as the "new third board," has seen a turnover of about 25.55 billion yuan (about 3.93 billion U.S. dollars) so far this year.From March 8 to March 12, its turnover hit approximately 2.24 billion yuan.Launched in 2013, the NEEQ intends to offer small and medium-sized enterprises a new financing channel with low costs and simple listing procedures.China has outlined a series of reforms to better orient the NEEQ to the needs and f
Related recommendations
STOCKS NEWS
Hot Content
  • company_name : Semiconductor Manufacturing International Corporation . Date : 2000-04-03 . listing_date : 2020-07-16 . Stock_code : 688981.SH、0981.HK . stock_market : sh . address : CricketSquare,HutchinsDrive,P.O.Box2681,GrandCaymanKY1-1111,CaymanIslands . zip : 201203 . phone : 86-21-20812800 . fax : 86-21-50802868 . site : www.smics.com .
  • company_name : Zhejiang Supcon Technology Co., Ltd. . Date : 1999-12-07 . listing_date : 2020-11-24 . Stock_code : 688777.SH . stock_market : sh . address : No.309 Liuhe Road, Binjiang District, Hangzhou, Zhejiang Province . zip : 310053 . phone : 86-571-86667525 . fax : 86-571-81118603 . site : www.supcontech.com .
  • company_name : Tianneng Battery Group Co.,Ltd. . Date : 2003-03-13 . listing_date : 2021-01-18 . Stock_code : 688819.SH . stock_market : sh . address : Industrial Park, Kishan Town, Changxing County, Huzhou City, Zhejiang Province . zip : 313100 . phone : 86-572-6029388 . fax : 86-572-6129388 . site : www.cn-tn.com .
  • company_name : Ninebot Limited . Date : 2014-12-10 . listing_date : 2020-10-29 . Stock_code : 689009.SH . stock_market : sh . address : Maples Corporate Services Limited at PO Box 309, Ugland House, Grand Cayman, KY1-1104, Cayman Islands . zip : 100192 . phone : 86-10-84828002*841 . fax : 86-10-84828002 . site : www.segway.com,www.ninebot.com,www.segwayrobotics.com .
  • company_name : Shenzhen Consys Science&Technology Co., Ltd. . Date : 2004-02-27 . listing_date : 2020-10-22 . Stock_code : 688788.SH . stock_market : sh . address : 5/F, Avionics Engineering R&D Building, No. 7, Langshan Road, Gaoxin North District, Xili Street, Nanshan District, Shenzhen, Guangdong Province, China . zip : 518057 . phone : 86-755-86111131*8858 . fax : 86-755-86111130 . site : www.consys.com.cn .
Contact
  • 86-021-88888888
  • 86-021-88888888
  • info@company-cn.com