Kaixin, China’s second biggest social networking site (SNS), has just released some new data that finally allow us to make some comparisons with industry leader Renren (NYSE: RENN), in what looks like a carefully timed move to restart its stalled IPO process to take advantage of hype surrounding the upcoming IPO for global leader Facebook. Frankly speaking, the Kaixin numbers look ok, but hardly seem to offer the kind of buzz the company would need to launch a hot IPO, especially in the current climate that has many US investors wary of Chinese companies following a series of accounting scandals last year. According to the handful of numbers given out by Kaixin, the company’s revenue grew 41 percent last year to about $60 million, while its registered user based reached 130 million, 60 million of whom were active users. (English article; Chinese article) The revenue looks rather weak compared to Renren, whose third-quarter revenue grew 57 percent to $34 million, meaning Renren is still about twice as big as Kaixin in revenue terms. (Renren Q3 announcement) In terms of users, Renren had 137 million registered users at the end of the third quarter, including 38 million unique users  logging in each month — figures that look similar but slightly stronger than Kaixin’s. What all this seems to say is that Kaixin and Renren are roughly equivalent in terms of their user numbers, but  that Renren has been more successful at parlaying its big user base into actual revenue, posting both stronger revenue and revenue growth compared to Kaixin. Despite its industry leading position, Renren shares have struggled since their IPO last year. They now trade at less than half their IPO level, though they got a nice bump after news first emerged that Facebook was preparing to file for its long awaited IPO, and are up about 20 percent since then. Kaixin is no doubt noticing the Facebook effect, and I suspect the company is now quietly scrambling behind the scenes to prepare its IPO documents so it can make a new filing in the next few weeks. Kaixin didn’t say whether it is profitable in its latest comments, which tells me it probably is still losing money, similar to Renren. But after months of shunning China stocks, perhaps the market is finally ready for another China Internet story, and Kaixin is clearly hoping to be that story. At the end of the day I could see a semi-successful offering for Kaixin, which in this case could be an IPO of about $100 million that probably won’t rise too much on its trading debut but also shouldn’t fall too much.

Bottom line: Kaixin’s release of limited new financial data indicate it may soon restart its stalled IPO, hoping to seize on hype generated by Facebook’s upcoming offering.

Related postings 相关文章:

◙ Kaixin Raises Profile in Renewed IPO March 开心网一改低调有意再次赴美上市

◙ Kaxin Buys Time With Tencent Tie-Up 开心网与腾讯合作堪称一箭双雕

◙ Gaopeng, Kaixin Spotlight China Internet Turmoil 高朋网、开心网凸显中国互联网混乱现状

We’ve seen a mini flood of data come out over the past week from China’s auto makers, as they release January sales that show domestic players may finally be turning a corner after a miserable 2011 that saw them lose big market share to international rivals. What I like to call the “big 3” of Chinese domestic brands, Geely (HKEx: 175), Chery and BYD (HKEx: 1211; Shenzhen: 002594) all outpaced the broader market’s 24 percent decline for the month, as overall domestic sales tumbled due to timing of the Lunar New Year this year in January instead of the usual February. (English article) Of the big domestic 3, Chery easily looks the most promising, with sales actually gaining 17.5 percent for the month, making it one of the few non-luxury brands to post a gain. In fact, that figure is for Chery’s total sales, including both domestic and overseas, which is significant as the company has become China’s biggest auto exporter, with exports doubling over last year’s January level to now account for 12 percent of its total sales. Chery’s export drive looks like a smart direction, as its moves to find a foreign joint venture partner at home to boost its domestic sales have been a bit more problematic. Last year the company’s plans to make cars with Japan’s Subaru was rejected by the state planner, and the company’s most recent plan to make luxury cars with Jaguar Land Rover also looks questionable. (previous post) Meantime, Geely and BYD both saw their January sales drop by 16.5 percent and 15 percent, respectively. While it’s never good to see a big drop like that, both figures are still quite a bit better than the broader market’s 24 percent decline, meaning both companies may have finally reversed their downward slide for much of last year. Of course, BYD’s year-ago comparisons are relatively low now after its sales plunged in 2011, and Geely also has a similar advantage. But both companies finally seem to have realized that they need to keep making popular new models to keep their sales growing, with BYD announcing several new models late last year. Of course January is just a single month and things could easily change in the months ahead. But at least based on this early bit of data, 2012 could be the year when Chinese brands finally fight back against the big foreign names and see their market share stabilize.

Bottom line: Big Chinese auto brands could see their share of the domestic market stabilize in 2012, slowing steady gains over the last 2 years by major international car makers.

Related postings 相关文章:

◙ 2 China Car Brands Set for Renaissance? “上海”和“红旗”汽车将重出江湖

◙ Chery Finds Foreign Partner in Jaguar 奇瑞与捷豹路虎联姻前景堪忧

◙ Cars: US, Germany Clobber Japan, Domestic Rivals 美德汽车在华完胜日本和中国车商