The Beijing-based tech business secured HK$41.28 billion ($5.32 billion) in its IPO after pricing its stock at HK$115 ($14.83) per share, at the top of the indicated price range. The Kuaishou IPO was backed by ten major investment companies, led by Capital Group and involving BlackRock and Fidelity.
The earliest retail investors could buy shares of the tech business was at HK$338 ($43.60) per share before it dropped to close the session at HK$300 a share ($38.70).
The app company said its IPO was oversubscribed. If the tech startup decides to issue more shares via the so-called overallotment option, the business could end up securing more than $6 billion.
The IPO marks another important step for the Hong Kong stock exchange, which has accommodated many renowned technology companies and secondary listings. The US-listed Chinese tech giants such as Alibaba and JD.com have also raised funds in Hong Kong.
The startup was developed by Beijing Kuaishou Technology in 2011. It first started operating as a GIF app named GIF Kuaishou. The business developed a mobile video app where users share short videos. The tech company makes a business profit from app users who purchase virtual gifts to their favorite streamers. The social media business said it also plans to expand into other markets, including ecommerce.
Two years later, the company launched its short video and social media platform, and in 2016, it introduced the live-streaming feature. The company’s apps currently have 769 million active users on a monthly basis.
During the period of nine months ended September 30, 2020, the app business made ¥40.68 billion ($6.2 billion) in revenue, marking a 49% year-on-year jump.
Still, the company sustained an adjusted net loss of ¥7.24 billion ($1.12 billion) during that period due to high marketing expenses.
In that period, the company said it had 262.4 million daily active users (DAUs), compared to 165.2 million recorded in the same period in 2019. Moreover, the number of its monthly paying users rose to 59.9 million from 48.5 million.
Kuaishou, the China-based tech startup that developed a short video mobile platform, raised $5.32 billion in its IPO before its shares gained a further 200%.
About the Author
As an analyst of global affairs, Adriaan has an MSC from Oxford, with diverse interests in the digital economy, entertainment, and business. He is a specialist trainer in Advanced Analytics & Media