Text: Xin Nan
Production: Planet Daily Odaily
Editor's note: This article has been deleted without changing the original intention of the author.
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In the past, the first share of the mining industry, Jia Nan Yunzhi, landed on Nasdaq, and later went to the New York Stock Exchange to list on the financial one account backed by Ping An of China. Blockchain track continued to be happy.
At 10:30 pm on the 12th, Beijing time, One Account Financial Technology Co., Ltd. (Financial One Account), a subsidiary of Ping An of China, was officially listed on the New York Stock Exchange in the form of American Depositary Shares (ADS) with a stock code of "OCFT".
A total of 31.2 million ADSs were issued by this account (ADS is equivalent to 3 ordinary shares per share). Underwriters can over-allocate an additional 4.68 million ADSs, with an IPO issue price of $ 10 and an opening price of $ 10.57. (23:23 Beijing time), Financial One Account ADS temporarily reported $ 10.24 per share.
In other words, the amount of funds raised by Financial OneAccount on the NYSE's IPO plan does not exceed 358.8 million US dollars. In the first prospectus that was initially listed in the United States, Financial OneAccount originally planned to raise 504 million US dollars.
According to a previous prospectus document, Financial OneAccount plans to use approximately USD 93.1 million of the funds raised to enhance platform building and technical capabilities; approximately USD 34.9 million for international expansion and strategic investment; approximately 2330 Ten thousand US dollars for sales and marketing activities and company expenses.
Urgently reduced the size of the IPO before the sale,
Valuation cut, stock price 40% off
Just two days before the opening of the transaction (December 11), Financial One Account submitted to the US SEC official website the revised content of the prospectus, which caused heated debate. In this modification, Financial OneAccount chose to reduce the size of its IPO.
According to the information disclosed by the official website of the United States SEC, in this reduction, the total financing amount previously forecasted by Financial OneAccount was reduced from US $ 500 million to US $ 260 million, and the issuance scale of ADS was reduced from 36 million ADS to 26 million ADS for sale. The number of shares has been reduced by 28%. In addition, the price of the proposed issuance range has been reduced from $ 12 to $ 14 to $ 9 to $ 10.
On December 13th, Financial One Account changed the fundraising scale again: it issued 31.2 million ADSs, and the underwriters could over-allocate an additional 4.68 million ADSs at an IPO price of US $ 10.
In other words, the actual IPO size of Financial OneAccount was reduced by 13.33% compared with the size of the initial disclosure of the US listing plan.
Based on the current IPO issue price of $ 10, the price per share of China OneAccount common stock is about $ 3.33. Compared to the price of up to $ 7.5 per share after the Series A financing, the price of the IPO is almost a 44% sale.
The operation of urgently reducing the size of the issue on the day before the issue was not common in the stock market. This operation has also attracted heated discussions in the industry. Everyone in the industry has commented that the valuation level of Series A financing is so high. This IPO The price is really a bit disappointing.
As a matter of fact, companies such as WeWork have also encountered a crisis of significantly lower valuations before going public, like Financial OneAccount, but the former option is to delay the IPO process.
Some people are puzzled by the operation of Financial One Account:
"What I don't understand is that the valuation has shrunk so much. Why don't you postpone listing? At least you are responsible for early investors?"
After the first reduction of the fundraising plan on December 11, some media statistics said that according to the original plan, after Financial One Account raised $ 504 million, the valuation was about 4.4 billion to 5.2 billion; after the IPO, the market value of Financial One Account was only US $ 3.6 billion, which is less than half of the 7.5 billion valuation of Softbank when it 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, and have instead focused on profitable companies or companies with clear profit paths. At the same time, the decrease in the size of Chinese companies' listings in the United States was due to the generally poor performance of IPOs, which in turn affected investor sentiment and forced many companies to reduce their funding scale.
Bloomberg data also shows that 30 Chinese companies that raised funds in the US IPO this year raised a total of US $ 3.25 billion, and their stock prices have dropped by an average of 25% from the issue price. Only 6 companies have higher stock prices than the issue price. In contrast, Chinese companies raised approximately $ 9 billion in IPOs in the United States in the same period last year, and fell an average of 11% in the first year of listing.
"Temporary downgrade of valuation expectations is a taboo, but I guess this time you may not want to go online like other Chinese stock companies listed on U.S. stocks before." A financial practitioner believes that lowering valuations and IPO offerings The price may be due to the fact that the current performance of U.S. and Chinese stocks is not very satisfactory. Financial One Account may hope to adjust the supply and demand relationship to exchange a better-looking IPO data.
OKEx Chief Strategy Officer Xu Kun analyzed to Odaily Planet Daily. The adjustment of valuations was mainly affected by the market environment. At the same time, Financial One Account did not show better than expected profitability. Despite the rapid growth in revenue, the loss was also Continue to expand, spending on R & D and market investment far exceeds revenue.
"Listing is just a new starting point, indicating that the company meets the relevant conditions and can face more investors. The most important thing is not the valuation at the time of listing, nor the short-term rise or fall, but the long-term high growth. High is not necessarily a good thing. "Xu Kun said.
Born with a golden spoon, it came to shore
As one of the four "unicorns" companies incubated by Ping An, Financial OneAccount is a fintech company hatched by Ping An Group and the second listed company under Ping An Group.
Fueled by China's second largest financial institution Ping An Group, Financial One Account has been the key factor for successful landing.
According to the prospectus, Ping An Group is not only a major shareholder of Financial OneAccount, but also its most important customer and supplier.
"(Finance One Account) Although it is listed independently, it still relies on Ping An's blood transfusion. 40% of its revenue comes from Ping An Group. If Ping An's customers (such as Lujin Institute) are added, this proportion will be higher. There is also the brand value that Ping An has given it. "Xu Kun analyzed.
According to public information, in the initial stage of the founding, most of the customers of Financial One Account relied on the customer relationship of Ping An Group, which also made its current customer structure rely more on Ping An Group and Lujin Holdings.
The prospectus states that as of September 30, 2019, Financial OneAccount had more than 3,700 customers in China's technology as a service platform, and its customer base includes all major banks in China, 99% of city commercial banks and 46% Insurance company. Revenue from the two major customers of Ping An Group and Lufax also exceeded 60%.
According to the data disclosed by the media IPO, Financial OneAccount in the first three quarters of 2017, 2018 and 2019 has received revenues of 235.7 million, 527.6 million and 677.3 million from Ping An Group, accounting for the total revenue of the same period. The yields were 40.5%, 37.3% and 43.6%.
According to the shareholder data in the prospectus, Ping An Group of China currently holds 39.87 million shares of Financial OneAccount through its 100% -controlled Bo Yu Limite, which is 39.7%. One of the major shareholders.
Not only that, as one of the “Ping An Four Little Dragons”, Financial One Account maintained a strong partnership with Ping An Group. The prospectus wrote that Financial OneAccount worked with Ping An Group to develop new technologies and applications, and Ping An Group provided support for its technical infrastructure (such as cloud infrastructure).
The prospectus also mentioned that Financial OneAccount and Ping An Group had signed a "strategic cooperation agreement", and the two parties cooperated according to the "strategic cooperation agreement", which is valid until ten years after the completion of the initial public offering. This cooperation The premise is that Ping An Group will continue to hold or beneficially own at least 30% of the financial OneAccount shares.
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 $ 100 million in ADS.
The prospectus wrote in detail: Assuming that the initial public offering price of each ADS is US $ 9.50 (taken from the median of the issue price), the number of ADSs that Ping An Overseas will purchase will be as high as 10,526,315 shares, accounting for 40.5% of the ADS.
Going your own path in the future is key
How bad is the Chinese stock market? Earlier, Tiger Sniff also mentioned that the external environment encountered by Financial One Account IPO was not ideal. Twelve of the 29 Chinese stocks currently listed have broken their hair. Even if they do not break their hair on the first day, they may have their hair broken in a month.
Of course, not only the market environment is not good, the financial transcripts submitted by Financial One Account in the United States are "scarred."
The prospectus shows that from 2017 to the first three quarters of 2019, Financial OneAccount has been in a loss state, with a cumulative loss of 3.124 billion yuan in less than three years. The loss data of this day's price move also made it suffer a lot of criticism in the early stages of listing.
According to the prospectus, the proportion of net losses to total revenue in the first three quarters of 2017, 2018 and 2019 was 104.3%, 84.2% and 67.5%, respectively.
At the same time, it can be seen from the prospectus that the current financial OneAccount's expenditures on the company's research and development costs and market and management costs are quite large. The total amount in the first three quarters of 2017, 2018 and 2019 accounted for the current receivables, respectively. 174%, 100%, 100%.
"I don't quite understand why Financial One Account is in a hurry to go public, the market is not good, and the industry is not good. Can't you rely on peace and hard practice for a few years?" Someone gave such an evaluation.
Even so, Financial OneAccount resolutely embarked on the road to IPO.
Backed by the Ping An Group's brand, it is considered to be the biggest advantage of Financial One Account, and the outside world believes that this has given them a deeper understanding of finance. Qiu Han, the joint general manager of Financial OneAccount, also said that compared with traditional technology outsourcing companies, the advantage of Financial OneAccount is to understand finance better.
However, some media believe that friends who compete with Financial OneAccount on the same track also have natural advantages. Financial OneAccount is constantly accepting competition from new entrants. They believe that among the customers of Financial OneAccount, non-paying users account for a large proportion. Based on publicly available data, non-paying users accounted for approximately 99.43% and 82.27% of the total users in the two years of 2017 and 2018, respectively.
The first prospectus disclosed also stated that the development of Financial One Account will follow the four stages of platform incubation period, platform customer acquisition period, high-speed growth period and profit growth period. However, at present, Financial OneAccount is still in the "platform acquisition period" and is preparing to enter the third stage. The prospectus also clearly stated that Financial OneAccount had obtained some customers through acquisitions or through referrals from Ping An Group, but it may not be possible to develop customers in the same way in the future.
In other words, if the relationship with Ping An Group collapses, the business of Financial OneAccount is likely to be severely damaged. Many investors are paying attention to how Financial OneAccount decouples from Ping An Group and takes a new path.
In this regard, ChinaVisit.com believes that expanding more customers outside Ping An Group is a key task of financial OneAccount's future revenue growth.
Another blockchain leading stock is born?
Less than a month after the first share of Mining Machinery's Jianan Yunzhi went to the NASDAQ for listing, Financial OneAccount with its blockchain business successfully landed on the New York Stock Exchange. From the news, it seems that the concept of blockchain is good . But the fact is that Financial OneAccount is not so vertical to the blockchain track.
When it first submitted its prospectus publicly, Financial OneAccount was positioned as a business technology cloud service platform (TaaS, Technology-as-a-Service). In terms of business, Financial One Account is also integrated from Ping An One Account, Qianhai Credit, and Bank One Account, which are mainly based on core technologies such as artificial intelligence, blockchain, and cloud platforms to provide technology services for enterprises.
At present, on the line of blockchain, Financial OneAccount has made one account chain of blockchain products. One account chain has also been used in supply chain finance, trade financing, SME loans, smart environmental protection, mortgages, and super cars. Scenes such as management office, 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 a comprehensive fintech service provider such as OneAccount is the future direction.
"Blockchain must break out of the weird circle of being chained for the sake of being on-chain. 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 play greater value "Said Xu Kun.
China Ping An Group is also a keen enthusiast of the blockchain. In the "Global Blockchain Patent Ranking in the First Half of 2019", Alibaba ranked first, followed by Ping An of China.
After analyzing the specific scenario, the current account chain has made several landing cases.
In terms of cross-border trade, Financial One Account's blockchain verification pilot project in Tianjin Port uses blockchain technology to automatically generate important documents in cross-border customs clearance, reducing operating costs and fraud risks.
In terms of supply chain finance, it provides the Hong Kong Monetary Authority with the design, development, and deployment of an international trade financing network. Through blockchain technology, it helps to digitize trade documents, improve bank lending capabilities, and support the service capabilities of small and medium-sized enterprises. Use blockchain to cooperate with electronic signatures to digitize non-standardized "account receivables" vouchers (Fujintong digital vouchers) to achieve multi-layer penetration of digital vouchers, penetrate core corporate credits to second- and third-tier enterprises, Corporate financing success rate.
In terms of traceability and asset on-chain, Financial OneAccount participated in Chow Tai Fook's diamond theft insurance project, and used the blockchain to record the true flow of diamonds to help diamond companies increase the value of their products while helping end customers to acquire more diamond information and increase asset value. In addition, Financial OneAccount also participates in a smart environmental protection platform, which records the collected environmental data on the blockchain by connecting devices such as IoT sensors. Based on the data provided by IoT devices, regulatory rating agencies can score environmental protection ratings of enterprises and try to introduce environmental impact assessment mechanisms. Enterprises with higher environmental assessments are more likely to obtain bank financing.
From the perspective of the scene, Financial OneAccount is just as willing to cooperate with traditional enterprises and governments to develop scenarios as most large companies test the blockchain. It is understood that the current financial OneAccount Blockchain SME services have been connected to more than 40,000 nodes.
Standing on the blockchain track where large companies gather to test the water, the exploration results of Financial OneAccount now seem to be relatively excellent. At least for Financial One Account, moving towards the blockchain is a good way to break the game.
And if we talk about the encouraging effect on the currency circle and even the chain circle, we may have to wait for its performance in the stock market.
However, at least a few seniors can learn from the situation is that no matter how beautiful the scene before the listing, in the end, it may be instantly hit by the market.
Perhaps, it is not necessary to expect too much for the listing of chain companies.
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