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X The first market of iaomi Corp. has failed to convince investors that he is able to do without cheap phones and become a giant of the internet. The Chinese smartphone giant is now under scrutiny as it tries to prove that it should be twice as expensive as Apple Inc.
After having raised $ 4.7 billion in an initial public offering, the first day of trading saw shares slide up to 6% in Hong Kong. The IPO had been touted as the culmination of a remarkable turnaround and the starting shot for a series of mega debut, but it came amidst sluggish markets and a resurgence of trade between the two countries. United States and China
. Lei Jun, Xiaomi has a market value of about 50 billion, far from the $ 100 billion boasted last year. The 1.2% drop at the close of trade is the worst first-day performance for a Hong Kong IPO of more than $ 1 billion since 2015.
Such a scandal can have a chilling effect on a handful of Chinese technology companies Meituan Dianping in Hong Kong to Tencent Music in the United States The performance of an eight-year-old smartphone brand with designs on the global expansion and transformation of 39, a low-world Xiaomi has set its IPO at a profit multiple higher than that of more established technology giants, including Apple, Tencent Holdings Ltd. and Facebook Inc., arguing that it was an Internet service company, even though most of its revenues came from hardware. He then suffered a number of setbacks, as he was forced to abandon his plans to sell Chinese certificates of deposit in Shanghai at the beginning of the trade tensions
"It will be difficult to convince investors, "said Elsie Sheng, analyst. with Orient Finance Holdings. "Although it claims to be an internet company with a lot of big data-related businesses, it remains a hardware business in terms of revenue source." he sells are low-end products. "
Captain Xiaomi and his floating empire, in the graphics: Tim Culpan
Lei Jun at the Xiaomi registration ceremony on July 9.
Photographer : Anthony Kwan / Bloomberg
In the longer term, Xiaomi's supporters claim that the dominance of India's markets to China and the diversification of the Internet of Things will help it to As Lei Jun hit the opening gong on Monday, he continued to launch Xiaomi as an "Internet company ."
Read more: Xiaomi is struggling with geopolitics and doubt about bargaining
Xiaomi is more expensive than some Source: Bloomberg data and reports
The IPO of Xiaomi has been hailed as the most important start of Chinese technology for years, attracting investors like George Soros and other billionaires Li Ka. Shing, Jack Ma and Pony Ma. Institutional investors including Hillhouse Capital, Qualcomm Inc. and China Mobile Ltd. also participated.
While $ 50 billion is not insignificant for a company, many canceled their sales in 2016, still barely worth $ 46 billion from a 2014 financing round. Goldman Sachs Group , Morgan Stanley and CLSA Ltd. were the co-sponsors of Xiaomi.
"Technology companies looking to list their stock will have to take a more conservative approach to pricing," says Anthea Lai, an analyst at Bloomberg Intelligence. That's "as investors become more cautious about where to put their money given the current trade tensions and several IPO flops recently."
Nowhere Fast
Xiaomi's valuation slept as other tech giants exploded
Source: Bloomberg [19659035] The tribulations of Xiaomi began almost from the moment she started his IPO trip. He had planned to raise about $ 10 billion worth up to $ 100 billion by taking advantage of the CDRs: an instrument that Beijing has pushed to encourage companies to register at home. But this collapsed when he could not adequately deal with the questions asked by the regulators.
| Read more on Xiaomi 's turbulent IPO trip: |
Regardless of market fluctuations, the company has raised billions to finance Lei' s vision of artificial intelligence in the world. cloud computing, standing against Alibaba Group Holding Ltd. and Baidu Inc. It is far from about a year ago, when the billionaire caused a soul collapse "
The sale of phones in the Overseas developed markets could be a more realistic goal, given the growing credibility of Xiaomi with affordable but reliable devices, as the construction of a wing of services and Internet content in its own right. really depends on the speed of growth – that's the open question right now, "said Ryan Roberts, senior analyst at MCM Partners, at Bloomberg Television." They can maintain that, that will bring an increase in margins just from the combination of revenues. "
Lei, who once made comparisons in the national media to Steve Jobs, took over hats off at Apple. thanked his supporters and his 190 million monthly active users known as Mi Fans.
"Although macroeconomic conditions are far from ideal, we believe that" a big company can still rise to the challenge and stand out, "said Lei in front of an audience packed on the Hong Kong Stock Exchange
– With the help of Yuan Gao and Fuk Yu Lung [19659041]
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