58.com’s Yao Jinbo (left) seems overwhelmed by the IPO excitement on stage with Tencent’s Pony Ma (right)
Shanghai-based online property brokerage Anjuke Group has taken its first step towards a listing in Hong Kong by filing an IPO application with the stock exchange on Thursday.
The Tencent-backed company didn’t disclose the size or timetable for the initial public offering, which is being jointly sponsored by BofA Securities, CICC and Credit Suisse. But the 14-year-old company was acquired by mainland online listings platform 58.com for $267 million six years ago, with analysts estimating last month that the stock listing could raise $1 billion.
The Hong Kong filing comes less than nine months after Anjuke competitor Beike, which was also backed by Tencent, raised $2.12 billion in its debut on the New York Stock Exchange, as investors continue to look for ways to fuse mainland China’s real estate industry with the internet.
Turning Listings to Gold
Anjuke’s online property listing platform is the largest in China by mobile monthly active users, recording an average mobile MAU of 67 million in the fourth quarter, while its online marketing platform for new and existing properties is the largest by revenue, the company said, citing information from consulting group iResearch.
Yao Jinbo thinks its time for Anjuke to test the market
Founded in 2007 and controlled by 58.com, Anjuke provides online marketing services for new and existing properties in China under the Anjuke and 58 Real Estate brands. Its services are used by property buyers, owners and tenants, as well as brokerages, agents and developers, Anjuke said in the filing.
The group reported unadjusted profit of RMB 1.91 billion, RMB 2.31 billion and RMB 1.95 billion for 2018, 2019 and 2020, respectively, and net profit margin of 30.7 percent, 30.4 percent and 24.3 percent for the same years.
Anjuke’s revenue is mainly derived from online marketing services offered to property brokerages, agents and developers, as well as commissions from new property sales transactions. Revenue totalled RMB 8.05 billion ($1.23 billion) in 2020, up from RMB 6.22 billion in 2018 and RMB 7.58 billion in 2019, according to the IPO filing.
The firm’s services include Aifang, a property transaction platform that facilitates developers’ new property sales via brokerages and agents, and Qiaofang, a “software as a service” product that promises to digitalise workflow and enhance operational efficiency for brokerages and agents.
Anjuke last month raised $250 million in funding in a pre-IPO round led by Chinese developer Country Garden’s affiliate Beam Merit, which invested $140 million in the company in a round also backed by Hong Kong family office Harmony Advisors Ltd and mainland developer Agile Group, according to the prospectus.
In addition to 58.com and its chairman Yao Jinbo and Tencent, other substantial shareholders heading into the IPO include Warburg Pincus and venture capital firm General Atlantic.
Real Estate Still in Style
With shares in Beike, which offers many of the same services as Anjuke, continuing to trade at over $55 after listing last August at $35.06, Anjuke is heading to market as companies linked to China’s real estate market continue to target stock exchange debuts.
In late March, Dalian Wanda Commercial Management Group revealed a plan to reorganise its non-development activities under the name of Wanda Light Assets Commercial Management Co. The restructured company, which will manage but not own Wanda’s retail properties, aims to list on the Hong Kong exchange, according to Reuters, which cited a source with knowledge of the plans.
In February, e-commerce provider JD.com announced plans to list its logistics unit in Hong Kong. The offering, backed by the e-commerce provider’s portfolio of more than 800 warehouses in China, is expected to value JD Logistics at as much as $40 billion, with the IPO potentially raising $5 billion, according to media reports.
Last November, the Hong Kong IPO of developer China Evergrande’s property services arm raised HK$14.3 billion ($1.8 billion), marking one of the largest in a flurry of real estate management companies seeking Hong Kong listings.
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