Chinese smartphone company Transsion plans to raise up to 5.7 billion won through its upcoming IPO on the Hong Kong Stock Exchange. Dominating the African smartphone market, Transsion is often referred to as the 'King of Smartphones in Africa.'
According to Bloomberg on October 7, Transsion announced its IPO plans in a filing with the Hong Kong Stock Exchange, stating it will offer 86.6 million new shares at a maximum price of HK$38.80 per share. This offering price is approximately 30% lower than its Shanghai Stock Exchange price of 53.8 yuan.
Through the Hong Kong IPO, Transsion aims to raise up to HK$3.36 billion (about 5.7 billion won). Including the over-allotment option, the total deal size could increase to around HK$3.8 billion (approximately 648.1 billion won). The listing date is set for October 15.
This marks a dual listing following its initial public offering on the Shanghai Stock Exchange in September 2019.
Investors include Singapore's sovereign wealth fund GIC, eFund Management, Millennium Capital, Golden Link Worldwide, and investment affiliates of Chinese semiconductor company Shenzhen Longsys Electronics.
Bloomberg predicts that Transsion's Hong Kong IPO will serve as a litmus test for investor interest in companies unrelated to artificial intelligence (AI).
Founded in 2013 in Shenzhen, China, Transsion owns smartphone brands such as Tecno and Infinix. It holds a 53% share of the mobile phone market in Africa by sales volume, earning it the nickname 'King of Smartphones in Africa.' While it boasts a significant market share in emerging markets like the Middle East, Latin America, and Southeast Asia, it does not sell smartphones in mainland China.
However, Transsion faces challenges, including pressure on profitability due to rising memory semiconductor prices and intensified competition in the African market from rivals like Xiaomi and Oppo.
In fact, Transsion's revenue last year fell by 4% to 65.5 billion yuan (approximately 13 trillion won), while net profit dropped by 53% to 600 million yuan.
Despite a rebound in revenue and profits in the first half of this year, its stock performance has been lackluster. Transsion's shares on the Shanghai Stock Exchange are about 70% lower than their peak in 2021 and have dropped approximately 20% this year, currently trading at 53.8 yuan.
Transsion plans to invest the funds raised from this listing into the development of AI-related technologies, aiming to accelerate the development of AI assistants and agents, among other innovations, to differentiate its products.
* This article has been translated by AI.
Copyright ⓒ Aju Press All rights reserved.