China online car sales platform Yixin seeks up to US$870m in Hong Kong share offer
The IPO by the Tencent-backed firm could be the third-largest by an internet business in the city this year
Yixin Group, China’s largest online car retailing platform, opened its initial public share offering in Hong Kong on Monday, seeking to raise as much as HK$6.77 billion (US$870 million) in what could be the third-largest internet business IPO in the city this year.
The firm, backed by Chinese internet giant Tencent, plans to issue 879 million shares in the global offering at an expected range of HK$6.6 to HK$7.7 each, with 10 per cent of the shares open for public subscription in Hong Kong from Monday to Thursday, according to its prospectus.
Yixin, established in 2014, expects to start trading on the Hong Kong stock exchange on November 16.
The firm’s largest shareholder, online car marketplace Bitauto, has a 51.6 per cent stake while Tencent currently holds 24.3 per cent and e-commerce platform JD.com and internet search firm Baidu own 12.7 per cent and 3.5 per cent respectively.
“The timing [for Yixin’s public offering] is good, as Tencent unit China Literature will announce its IPO subscription results tomorrow and that will unfreeze investor capital, possibly releasing a large amount of liquidity into the market,” said Alvin Cheung, a director at Prudential.
Measured by the volume and the value of car retail transactions, Yixin was mainland China’s largest online car retail transaction platform in 2016, with a market share of 19 per cent, according to a report by market research firm Frost & Sullivan.
In 2016, the company recorded more than 260,000 car and car-related retail transactions online, with an estimated aggregate value reaching over 26 billion yuan (US$4 billion).