21st Century Business Herald reporter Cao Enhui reports from Shanghai
On the evening of December 15th Beijing time, domestic MRO procurement service platform Zhenkunxing (code "ZKH") was officially listed on the New York Stock Exchange, becoming the first Chinese concept stock of MRO concept.
In this IPO to the United States, Zhenkunxing will issue 4 million American Depositary Shares (ADS) at an issue price of $15.5 per ADS. Based on this issuance price, Zhenkunxing raised $62 million ("Green Shoes Front") through this IPO, and the underwriters have an additional 600000 shares of ADS overallocation rights.
Based on the issuance price, the market value of Zhenkunxing is approximately $2.5 billion, which is also the largest Chinese concept stock in the past two and a half years.
On the first trading day, the stock price of Zhenkunxing rose by 16.13% during trading and eventually closed flat.
According to the prospectus, 30% of the funds raised by Zhenkunxing will be used to further expand its business, especially to continue developing the selected product line of experts; About 30% is used to strengthen supply chain capabilities and further improve performance efficiency; Approximately 30% for potential strategic investments and acquisitions; The remaining portion is used for general corporate purposes, including working capital needs, investment in research and development to continue building infrastructure and improving digital services, as well as expanding overseas markets.
According to 21st Century Business Herald reporters, both Tencent and Canada Pension Fund, existing shareholders of Zhenkunxing, have participated in the subscription for this issuance. Among them, the Canadian pension fund subscribes to ADS worth $10 million, while Tencent subscribes to ADS worth $5 million.
China is the country with the largest industrial output value in the world and the only country to have all industrial categories listed in the United Nations International Standard Industrial Classification. According to data from the National Bureau of Statistics, the output value of China's secondary industry reached 48.3 trillion yuan in 2022, accounting for approximately 28.2% of the global industrial output value. It is expected that the output value of China's secondary industry will grow at a compound annual growth rate of 5.7%, reaching 63.6 trillion yuan in 2027.
Among them, the market size of MRO procurement services in China was 3004.1 billion yuan in 2022, with a compound growth rate of 5.8% from 2022 to 2027. It is expected to reach 3976.6 billion yuan in 2027. It is worth mentioning that the report released by CIC points out that with the rapid development of technologies such as the Internet, SaaS, intelligent logistics, and IT infrastructure, MRO procurement is also gradually becoming digitized, with huge potential. It is expected that the market size of online MRO procurement services in China will reach 847 billion RMB in 2027.
The relatively low online penetration rate and dispersed market concentration between online platforms provide huge market opportunities for the MRO procurement service platform. Including Zhenkunxing, companies such as JD.com, Misemi, and Gu'anjie are also rubbing their hands together.
As of the end of September 2023, Zhenkunxing, which went public in the United States, has accumulated 64000 customers. Financial data shows that the company's GMV for the first three quarters of this year was approximately 7.9 billion yuan, an increase of 17.5% compared to the same period in 2022; The net income achieved was 6.277 billion yuan, which was significantly higher than the same period in 2022.
In addition, due to an increase in gross profit margin, a decrease in management expense ratio and performance expense ratio, Zhenkun Bank's adjusted net loss has significantly narrowed, with a year-on-year decrease of 42% in losses in the first three quarters of this year.