Tag Archives: China Auto

News Digest: September 6-9, 2014

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The following press releases and media reports about Chinese companies were carried on September 6-9. To view a full article or story, click on the link next to the headline.
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  • Alibaba Sets IPO Price Range Of $60-$66, To Raise Up To $24.3 Bln (Chinese article)
  • SAIC: E-Commerce Firms Face Fines Up To 500,000 Yuan For Fake Transaction Reporting (Chinese article)
  • China Mobile (HKEx: 941) Completes Purchase Of 18 Pct Of Thailand’s True Corp (HKEx announcement)
  • China Auto Rental To List In HK On September 19, Raise Up To $468 Mln (Chinese article)
  • LightInTheBox (NYSE: LITB) Settles Class Action Lawsuit (PRNewswire)

Qunar, Ctrip In Fund-Raising Frenzy

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Qunar makes public IPO filing

Update: After publishing this originally, a Qunar spokeswoman pointed out that Goldman Sachs was among the investment banks underwriting its IPO. So that changes the tenor of the last part of the post, which says that no premium investment banks were involved in the offering.

 

A long awaited year-end fund-flurry of fund raising by Chinese tech firms is gaining momentum, with online travel sites Qunar and Ctrip (Nasdaq: CTRP) leading the charge as investor interest finally returns to the market. Qunar has just made the first public filing for its long-delayed IPO, while Ctrip continues to dazzle the markets by raising the size of its recent mega bond offer for the second time, underscoring strong demand from investors. Read Full Post…

IPOs: LightInTheBox Files, China Auto Reawakens

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China Auto ties up with Hertz

After nearly half a year of inactivity, signs of a spring for China IPOs in New York are finally appearing with the first public filing by an online retailer named LightInTheBox. At the same time, auto rental specialist China Auto Rental has just formed an important new tie-up with global peer Hertz (NYSE: HTZ), leading media to speculate the company could soon restart its IPO that it aborted more than a year ago due to weak market sentiment. I have to say that both of these potential IPOs caught me a bit by surprise, as neither was the kind of exciting deal I was looking for to rekindle interest in the moribund market for new Chinese listings. Read Full Post…

YY Marches To Market YY开赴市场

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The latest signs of a thaw in overseas sentiment toward Chinese stocks is coming today with news that online networking site YY has set a price range for its New York IPO, in what would become only the second major US offering by a Chinese firm this year. At the same time, media are reporting that the US securities regulator is moving closer to a deal with its Chinese peers that will give it better access to the auditing records of US-listed Chinese firms, another major development that should further boost investor confidence.

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Qunar Joins Year-End IPO Queue 去哪儿网有望年底赴美上市

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We’re seeing growing signs that a mini-parade of Chinese IPOs could march through New York in the last 2 months of 2012, with word that online travel site Qunar hopes to list in the US by the end of the year. (Chinese article) If the reports are true, Qunar would join a small but growing list of Chinese companies that could make US listings by year end, with video sharing sites operated by Xunlei and Sohu (Nasdaq: SOHU) also sending similar signals. (previous post) If these listings go well, we could even see one of the shakier companies that has been waiting patiently to make a listing quickly move forward with an IPO, with online clothing retailer Vancl the most likely candidate in this category.

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Jingdong Mall, LaShou: Turmoil in Cyberspace 京东商城、拉手网：互联网领域混乱

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The latest signs of trouble in China’s overheated Internet sector are bubbling into the headlines again, with word that group discount leader LaShou has scrapped its troubled IPO while another high level executive has resigned from e-commerce giant Jingdong Mall, also known as 360Buy. Both developments have some company-specific issues behind them, but more broadly speaking they also reflect an overheated China Internet that has seen internal turbulence grow at many companies as they struggle for dominance and simply survival.

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Shanda Cloudary IPO Glides Ahead 盛大文学推进IPO计划

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The literature unit of online game giant Shanda Interactive seems determined to move forward with its plan for a New York IPO despite a weak investor climate, landing $15 million in new funds from venture investor Orbis as it forges ahead. This kind of late-stage investment is clearly designed to generate some buzz for an offering that looks slightly interesting to me, but may still have limited appeal for the average Wall Street investor worried about recent volatility in US-listed China stocks after a series of accounting scandals last year. This latest investment also seems aimed at setting a valuation for the unit, Shanda Cloudary, again as Shanda Interactive looks to raise as much cash as possible to help pay down its big debt from its own recent privatization. (previous post) Let’s have a look at the actual news, which has Orbis taking a 1.875 percent stake in Cloudary for its $15 million investment, valuing the company at a relatively modest $800 million. (Chinese article) That’s far less than Shanda Interactive was worth when it delisted earlier this year. It’s also about two-thirds of the value of Shanda’s only other listed unit, Shanda Games (Nasdaq: GAME), reflecting the fact that this literature unit may have big potential as a supplier of online literature even though it generates significantly less revenue than Shanda’s core online gaming business. Shanda filed to list Cloudary last year but had to withdraw the plan when market sentiment plummeted. It refiled the plan earlier this year (previous post), reflecting its urgent need for new cash even as broader market sentiment remained weak. The only major Chinese company to make a New York listing so far this year, discount online retailer Vipshop (NYSE: VIPS), was a major failure, and lingering negative sentiment forced one of the year’s only other China IPO candidates, auto rental firm China Auto, to withdraw its offering just before the final pricing last month. (previous post) From my perspective, I’ve always thought the Cloudary IPO looked like an interesting proposition, as online literature is clearly a big growth market as rapidly growing numbers of Chinese mobile Internet users look for interesting things to read on their tablet PCs and smartphones. As an early entrant to this market, Cloudary looked well positioned to become a major player in the space. What’s more, the company surprised the market last month when it announced its first-ever modest profit of about 3 million yuan for the first quarter of this year. Profitability has been rare among the stream of Chinese Internet companies to make IPOs over the last 2 years, so that fact could help ease investor concerns, even though Cloudary’s sudden move into the profit column, while not surprising based on recent trends, also may have been assisted by some accounting maneuvers. Regardless of that, I still do think the company’s potential, its relatively strong income statement and relatively modest valuation could mean it may actually succeed in becoming only the second Chinese Internet company this year to make a New York IPO, providing an interesting investment opportunity for anyone who likes this emerging growth area.

Bottom line: A new round of fund-raising indicates Shanda is moving ahead with the IPO for its Cloudary online literature unit, which could receive moderate investor interest.

Related postings 相关文章:

◙ Shanda Cloudary Wows Investors With Profit 盛大文学利润令投资者惊叹

◙ China Auto IPO Crashes 神州租车的IPO之梦告吹

◙ China IPO Winter Goes On as Vipshop Flops 唯品会大跌，中国IPO冬季持续

IPOs: BMW Distributor Crashes, PICC Revs Up 永达汽车搁置IPO计划 中国新股持续遇冷

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Just a week after a top Chinese auto rental firm scrapped its plans for a New York IPO, another auto specialist, Yongda Automobile Services has also junked plans for a listing in Hong Kong, reflecting not only cooling overseas demand for Chinese IPOs but also the chill that is settling over the country’s auto sector. But the true test for offshore Chinese IPOs could still be coming, as insurance major PICC gets set for a mega-IPO in Shanghai and Hong Kong to raise up to $6 billion. Let’s look at the Yongda news first, which has seen the operator of China’s largest distributor of cars from luxury German automaker BMW (Frankfurt: BMWG) cancel its plans for a Hong Kong plan to raise up to $430 million due to anemic demand. (English article) The decision comes just a week after auto rental specialist China Auto also formally scrapped its plans for a New York IPO after originally filing for the offering back in January. (previous post) The failure of both of these IPOs reflects not only weak sentiment for new offerings in general, but also the anemic state of car sales in China, which passed the US in 2010 to become the world’s largest auto market but has seen growth slow dramatically over the last year as China’s economy slows. While the failure of China Auto’s IPO isn’t too surprising, the withdrawal of the Yongda listing was a bit more unexpected because sales of luxury cars like BMW seemed to be more immune to the slowdown in China. Thus this lack of investor interest seems to indicate that markets expect an imminent slowdown as well for the luxury segment, which is still seeing growth in the 30-40 percent range even as broader market gains have fallen into the low single digits. Meantime, People’s Insurance Company of China (PICC), one of China’s top insurers, is hoping to avoid a similar fate to Yongda by bringing more major investment banks into its dual listing plans. (English article) Foreign media are reporting the company has added 14 investment banks, including powerhouses like Goldman Sachs (NYSE: GS) and Morgan Stanley (NYSE: MS), to the group underwriting the Hong Kong portion of its IPO aiming to raise around $3 billion from foreign investors. The addition of so many major foreign investment banks, combined with PICC’s strong state backing, means that this offering is very likely to go forward despite weak sentiment in the broader market, though I wouldn’t expect it to price very strongly and the final amount of funds raised in Hong Kong could be closer to $2 billion. One of the few Chinese companies to successfully make a major Hong Kong IPO in recent months was another insurance company, New China Life (HKEx: 1336), which raised $1.3 billion in the Hong Kong portion of a dual listing late last year. The company’s shares initially surged, but have since given back most of the gains and are now just slightly ahead of their offering price — roughly in line with the broader market. Given recent uncertainty in the broader insurance market, I wouldn’t expect too much excitement from this PICC offer though it should indeed go forward. When that happens, look for the stock to trade sideways or sink lower after its trading debut.

Bottom line: The scrapping of an IPO by China’s top BMW distributor and addition of major banks to a planned IPO for major insurer PICC reflect continued weak demand for new China offerings.

Related postings 相关文章:

◙ China Auto IPO Crashes 神州租车的IPO之梦告吹

◙ Ping An Returns to Market With Second Big Fund Request 中国平安拟发大规模可转债

◙ Year End Brings Problematic New IPO Wave 中国新一波IPO潮或无法达预期效果

China Auto IPO Crashes 神州租车的IPO之梦告吹

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The winter for China IPOs in New York has officially moved into deep freeze with the official announcement that car rental specialist China Auto, the first Chinese company to file for a US listing back in January, has formally scrapped the offering. (Chinese article) The official withdrawal, made in a filing to the US securities regulator, marks the end of a choppy story that saw the money-losing China Auto filled with optimism when it initially filed for a Nasdaq IPO to raise up to $300 million in January, hoping that US investor skepticism towards Chinese companies had eased following a confidence crisis the previous year due to a series of accounting scandals. The first signs that perhaps the climate hadn’t improved too much came in the next couple of months, when China Auto’s IPO failed to make much progress, presumably due to lack of investor interest. The situation got worse still when online discount retailer Vipshop (NYSE: VIPS) did finally become the first Chinese company to list in the US in March, but only after it had to drastically scale back the offering due to anemic demand. (previous post) And even then, its shares priced below their original range and dropped sharply in their first few trading days. Despite that dismal performance, China Auto moved ahead with its own offering, which also met with anemic demand that forced it to halve the size of its original capital raising plan. But even that reduced plan soon looked ambitious, and it ended up suspending the offering just hours before it was set to price in late April. (previous post) The aborted offering means we could soon go an entire year with just one new listing for a Chinese company in the US. The last major listing before the current freeze came back in August last year, when online video company Tudou (Nasdaq: TUDO) forged ahead with its IPO despite a weak market, with the result that the stock dropped sharply on its trading debut. (previous post) The CEO of the New York Stock Exchange’s operator said in an interview earlier this week that only 7 Chinese companies went public on NYSE Euronext stock exchanges last year, a third of the 22 companies that made IPOs on its exchanges in 2010 when Chinese companies — especially in the Internet sector — were investor darlings. (English article) If current trends continue, we could see just 1 company list on the NYSE for all of 2012, which undoubtedly would be a low not seen for many years. There’s still a possibility we could see 1 or 2 other offerings proceed, especially one for Shanda’s online literature unit, Cloudary, which appears to be moving forward after the company reported a surprising profit in its latest quarter. (previous post) But if that IPO also fizzles, which is a strong possibility, look for the winter for Chinese IPOs in New York to easily continue until this fall, and quite possibly through the end of the year.

Bottom line: China Auto’s official withdrawal of its New York IPO shows the current winter for US-listed Chinese offerings continues, and could easily last through the end of the year.

Related postings 相关文章:

◙ Shanda Cloudary Wows Investors With Profit 盛大文学利润令投资者惊叹

◙ IPOs: China Auto Slashes, People’s Daily Marches Ahead IPOs:神州组车减，人民网启动

◙ China IPO Winter Goes On as Vipshop Flops 唯品会大跌，中国IPO冬季持续

News Digest: May 25, 2012 报摘： 2012年5月25日

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The following press releases and media reports about Chinese companies were carried on May 25. To view a full article or story, click on the link next to the headline.

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◙ China Banks May Miss Loan Target for 2012, Officials Say (English article)

◙ China’s CIC eyes Up to $2 Billion Stake in Alibaba Group: Sources (English article)

◙ E-House (NYSE: EJ) Reports Q1 Results (PRNewswire)

◙ Tencent (HKEx: 700) to Invest $1 Bln in E-Commerce Subsidiary (English article)

◙ China Auto Withdraws Nasdaq Listing Application (Chinese article)

IPOs: Fosun Pharma Tries Again, China Auto Stalls 上市：复星医药再次尝试，神州租车紧急暂停

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The prolonged winter for Chinese stocks listing overseas is clearly continuing, based on the latest IPO news that has seen one company delay its planned New York offering while another is making a second try at a Hong Kong listing. What’s perhaps significant in both of these cases is that neither company is a riskier tech start-up, and instead both come from mature industries with more dependable track records, meaning this IPO winter could be longer and deeper than many initially expected. The first development has seen auto rental specialist China Auto delay its already late New York IPO due to anemic demand; while the second has seen drug maker Fosun Pharmaceutical relaunch its own Hong Kong IPO after abandoning the deal last year. Let’s first look at China Auto, whose last-minute decision to delay its IPO should come as a surprise to no one. (Chinese article) Signs of trouble were already emerging earlier this week for what would have been the second offering this year by a Chinese firm in New York, where investor sentiment remains weak following a series of accounting scandals last year. Foreign media previously reported the offering, which initially hoped to raise up to $300 million when China Auto made its first public filing in January, was getting anemic demand and that buyers had ordered only half of the shares for sale just a day before the offering was set to price. I predicted the offering could ultimately raise around a quarter of its original target, and now it appears perhaps even that was an optimistic forecast. (previous post) In light of this latest delay, I wouldn’t be surprised if China Auto abandons the offering completely and waits for sentiment to improve. Meantime, Fosun Pharmaceutical has been approved to raise up to $800 million in a Hong Kong offering, according to numerous media reports. (English article) Anyone with a long enough memory might recall that Fosun Pharmaceutical originally filed to make a Hong Kong IPO worth up to $1 billion a little more than a year ago, but then never completed the plan. (previous post) No reason was ever given for the withdrawal of last year’s plan, which should have been attractive as it offered a window into China’s fast-growing health care industry. Clearly sentiment was much better at this time last year, so the fact that Fosun Pharma is relaunching its IPO in such a weak climate now probably reflects that it desperately needs cash. If that’s the case, look for this offering to also meet with weak demand, and for the company to ultimately raise far less than the $800 million it is targeting.

Bottom line: The latest IPO developments from China Auto and Fosun Pharma indicate the current winter for Chinese overseas IPOs could last for at least a few more months.

Related postings 相关文章:

◙ IPO Chill Bites LaShou, China Auto 中资企业赴美上市连遭冷遇

◙ IPOs: China Auto Slashes, People’s Daily Marches Ahead IPOs:神州组车减，人民网启动

◙ Fosun Pharma Offers Window to China Healthcare Reform