Previously, Canaan Zhizhi, the first mining company, landed on NASDAQ, and later, OneConnect, a financial company backed by China’s Ping An, went public on the New York Stock Exchange.
At 10:30 p.m. on the 12th, Beijing time, OneConnect Financial Technology Co., Ltd. (Financial OneConnect), a subsidiary of Ping An, was officially listed on the New York Stock Exchange in the form of American Depositary Shares (ADS), with the stock code of "OCFT".
OneConnect has issued a total of 31.2 million ADSs (each ADS is equivalent to 3 ordinary shares), and the underwriters can over-allocate an additional 4.68 million ADSs. The IPO issue price is US$10 and the opening price is US$10.57. (23:23 Beijing time), OneConnect’s ADS per share was tentatively quoted at US$10.24.
In other words, the planned IPO of OneConnect on the NYSE this time will not exceed US$358.8 million, while in the first prospectus for its listing in the United States, OneConnect originally planned to raise US$504 million in its IPO. Dollar.
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Before the launch, the scale of the IPO was urgently reduced, the valuation was cut in half, and the stock price was 40% off for promotion
Just two days before the opening of trading (December 11), Financial OneConnect submitted the revised content of the prospectus to the official website of the US SEC, which aroused heated public opinion. In this revision, OneConnect chose to lower its IPO issuance scale.
According to the information disclosed on the official website of the US SEC, in this downward adjustment, the total financing amount expected by OneConnect was lowered from US$500 million to US$260 million, and the scale of ADS issuance was lowered from 36 million ADSs to 26 million ADSs. The number of shares was lowered by 28%. In addition, the proposed issue price range has also been lowered from $12 to $14 to $9 to $10.
On December 13, OneConnect once again revised its fundraising scale: issue 31.2 million ADSs, underwriters can over-allocate an additional 4.68 million ADSs, and the IPO issue price is US$10.
That is to say, OneConnect’s real IPO scale has shrunk by 13.33% from the scale when it first disclosed its listing plan in the US.
Based on the current IPO price of US$10, the price of each common share of OneConnect is approximately US$3.33.Compared with the price per share as high as US$7.5 after the A round of financing, the IPO price is almost a 4.4% discount.
The operation of urgently lowering the issuance scale one day before the issuance is not common in the stock market. This operation has also attracted heated discussions among industry insiders. Everyone in the industry commented: The valuation level of the A round of financing is so high. For the price it was a bit disappointing.
In fact, companies such as WeWork, like OneConnect, also encountered a crisis of sharply lower valuations before going public, but the former chose to postpone the IPO process.
Some people were puzzled by the operation of OneConnect: "What I don't understand is that the valuation has shrunk so much, why not delay the listing? At least be responsible to the early investors?"
After lowering the fund-raising plan for the first time on December 11, some media statistics said that according to the original plan, after raising US$504 million, the valuation of OneConnect was about US$4.4 billion to US$5.2 billion; after the IPO, the market value of OneConnect was only 3.6 billion, which is less than half of the 7.5 billion valuation when SoftBank invested in the company in 2018.
Foreign media reports believe that, after several high-profile IPO failures this year (such as WeWork), investors have become more skeptical of valuations, focusing instead on profitable companies or some companies with a clear path to profitability. at the same time,The reduction in fundraising by Chinese companies going public in the U.S. is due to the generally poor performance of IPOs, which in turn has weighed on investor sentiment and forced many companies to scale back fundraising.
According to data from Bloomberg, the 30 Chinese companies raised US$3.25 billion in US IPOs this year, and their share prices have fallen by an average of 25% from the issue price, with only 6 companies’ share prices higher than the issue price. In contrast, Chinese companies raised about $9 billion in U.S. IPOs during the same period last year, with an average decline of 11 percent in their first year of listing.
"Temporarily lowering valuation expectations is a big taboo, but I guess this time it may be because you don't want to go online like other Chinese stock companies listed on the US stock market before." A financial practitioner believes that lower valuations and IPO sales The price may be due to the fact that the current performance of U.S. stocks and Chinese concept stocks is not satisfactory. Financial OneConnect may hope to exchange for better IPO data by adjusting the relationship between supply and demand.
Xu Kun, chief strategy officer of OKEx, analyzed to Odaily that the adjustment of valuation was mainly due to the impact of the market environment. At the same time, OneConnect did not show better-than-expected profitability. Although revenue has grown rapidly, losses have continued to expand , The cost of R&D and marketing far exceeds the revenue.
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Born with a golden spoon in his mouth, he went ashore as a matter of course
As one of the four "unicorn" companies incubated by Ping An, OneConnect is a financial technology company incubated by Ping An Group, and it is also the second listed company under Ping An Group.
With the help of Ping An Group, the second largest financial institution in China, OneConnect has obtained the key factor for its successful landing.
According to the prospectus, Ping An Group is not only the major shareholder of OneConnect, but also its most important customer and supplier.
"Although (OneConnect) is listed independently, it is still relying on Ping An's blood transfusion. 40% of its revenue comes from Ping An Group. If you add Ping An's customers (such as Lufax), this proportion will be even higher. In addition, there is the brand value endowed by Ping An." Xu Kun analyzed.
According to public information, in the early days of its founding, OneConnect’s customer acquisition mostly relied on the customer relationship of Ping An Group, which also makes its current customer structure mostly rely on Ping An Group and Lufax Holdings.
according to
according toThe media IPO has long knownAccording to the disclosed data, OneConnect received 235.7 million yuan, 527.6 million yuan and 677.3 million yuan in revenue from Ping An Group in 2017, 2018 and the first three quarters of 2019, accounting for 40.5% of the total revenue in the same period. 37.3% and 43.6%.
It can also be known from the shareholder data in the prospectus that at present, Ping An Group of China, through its 100% holding Bo Yu Limite, beneficially holds 398.7 million shares of OneConnect, holding 39.7% of the shares, which is owned by OneConnect. One of the major shareholders.
Not only that, OneConnect, one of the "Four Ping An Tigers", also maintains a strong partnership with Ping An Group. According to the prospectus, OneConnect and Ping An Group cooperate to jointly develop new technologies and applications, and Ping An Group provides support in terms of technical infrastructure (such as cloud infrastructure).
The prospectus also mentions that,OneConnect and Ping An Group have signed a "Strategic Cooperation Agreement". According to the "Strategic Cooperation Agreement", the two parties will cooperate until ten years after the completion of the initial public offering. The premise of this cooperation is that Ping An Group continues to hold Own or beneficially own at least 30% of the shares of OneConnect。
In addition, the latest updated IPO prospectus also brought another good news:Ping An Overseas Holdings, a subsidiary of Ping An Group, intends to subscribe for up to US$100 million of OneConnect ADSs.
The prospectus states in detail:secondary title
Are you in a hurry to go public before weaning? Going out of your own path in the future is the key
How bad is the Chinese concept stock market? It was also mentioned in the previous Tiger Sniff report that the external environment encountered by OneConnect’s IPO was not ideal. 12 of the 29 Chinese concept stocks currently listed have broken. Even if they do not break on the first day, they may usher in a break in a month.
Of course, not only is the market environment poor, but the report card handed over by OneConnect’s listing in the United States is even more “scarred”.
According to the prospectus, from 2017 to the first three quarters of 2019, OneConnect has been in a state of loss, with a cumulative loss of 3.124 billion yuan in less than three years. The loss data of this sky-high move also caused it to encounter a lot of criticism in the early stage of listing.
According to the prospectus, the net losses in the first three quarters of 2017, 2018 and 2019 accounted for 104.3%, 84.2% and 67.5% of total revenue, respectively.
At the same time, it can also be seen from the prospectus that OneConnect currently spends quite a lot on the company’s research and development expenses, marketing, and management expenses. 174%, 100%, 100% of the
"I don't quite understand why OneConnect is in a hurry to go public. The market is not good, and the industry is not good. Is it not enough to rely on Ping An and practice hard for a few years?" Someone gave such an evaluation.
Even so, OneConnect has resolutely embarked on the road of IPO.
Backed by the brand of Ping An Group, it is considered the biggest advantage of OneConnect. The outside world believes that this makes them have a deeper understanding of finance. Qiu Han, co-general manager of OneConnect, also said that compared with traditional technology outsourcing companies, OneConnect’s advantage lies in its better understanding of finance.
but alsoSome media think, Competitors competing with OneConnect on the same track also have natural advantages, and OneConnect is constantly accepting competition from new entrants. They believe that among the customers of OneConnect, the proportion of non-paying users is relatively large. rootAccording to public data calculations, in the two years of 2017 and 2018, non-paying users accounted for approximately 99.43% and 82.27% of the total users respectively.
It is also stated in the first disclosed prospectus that the development of OneConnect will follow four stages: platform incubation period, platform customer acquisition period, rapid growth period and profit growth period. However, OneConnect is still in the "platform customer acquisition period" and is preparing to enter the third stage. The prospectus also clearly stated:OneConnect has acquired some customers through acquisitions or through referrals from Ping An Group, but it may not be able to develop customers quickly in the same way in the future.
For this,
For this,secondary title。
Another blockchain leading stock was born? Should the currency circle and chain circle climax?
Less than a month after Canaan Zhizhi, the first mining machine stock, went public on Nasdaq, OneConnect, a financial company with its own blockchain business, successfully landed on the New York Stock Exchange. On the surface, it seems to be good for the concept of blockchain . But the fact is that OneConnect is not so vertical to the blockchain track.
When it first publicly submitted its prospectus, OneConnect was positioned as a business technology cloud service platform (TaaS, Technology-as-a-Service). In terms of business, OneConnect is also integrated from Ping An OneConnect, Qianhai Credit Information, and Bank OneConnect. It mainly provides technological services for enterprises based on core technologies such as artificial intelligence, blockchain, and cloud platforms.
At present, in the blockchain line, OneConnect has produced a blockchain product, Onechain, which has also been used in supply chain finance, trade financing, small and medium-sized enterprise loans, smart environmental protection, mortgages, and supercars. Scenarios such as management offices, drug traceability, and electronic medical records have been implemented, covering the five major ecosystems of finance, smart cities, real estate, automobiles, and medical care.
Xu Kun believes that pure BaaS services are relatively limited, and comprehensive financial technology service providers such as OneConnect will be the future direction.
"Blockchain must jump out of the vicious circle of chaining for the sake of chaining. For example, under the goal of improving business efficiency, blockchain needs to be combined with other technologies, AI, big data, including the Internet of Things to exert greater value. .” Xu Kun said.
Ping An Group of China is also a keen enthusiast of the blockchain. In the "Global Blockchain Patent Rankings for the First Half of 2019", Alibaba ranked first, followed by Ping An.
Analyzing the specific scenarios again, One Account Chain has made several landing cases.
In terms of cross-border trade, OneConnect’s blockchain verification pilot project at Tianjin Port uses blockchain technology to automatically generate important documents for cross-border customs clearance, reducing operating costs and fraud risks.
In terms of supply chain finance, provide the Hong Kong Monetary Authority with the design, development and deployment of an international trade financing network. Through blockchain technology, help digitize trade documents, improve bank lending capabilities and support service capabilities for small and medium-sized enterprises; Foton Motor ALL-Link project Use the blockchain and electronic signature to digitize the non-standardized "accounts receivable" certificate (Fujintong digital certificate), realize the multi-layer penetration of digital certificates, penetrate the core enterprise credit to the second and third tier enterprises, and use its small and medium-sized Corporate financing success rate.
In terms of traceability and asset on-chain, OneConnect participated in the Chow Tai Fook diamond theft and loss insurance project, using the blockchain to truly record the circulation of diamonds, helping diamond companies improve product value while helping end customers master more diamond information and increase asset value. In addition, OneConnect also participated in a smart environmental protection platform, which records the collected environmental data on the blockchain by connecting devices such as IoT sensors. Through the data provided by IoT devices, regulatory rating agencies can rate companies for environmental protection and try to introduce an environmental assessment mechanism. Companies with higher environmental ratings are more likely to obtain financing from banks.
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But at least what can be learned from a few predecessors is that no matter how good it was before the listing, it may be beaten back to its original shape by the market in an instant.
Perhaps, there is no need to expect too much about the listing of chain companies.
