IPO Season in Shanghai: Hangke Technology Priced at CNY 27.43 per Share
Hangzhou-based battery test equipment manufacturer with stellar financial performance is the fourth firm to start its journey onto the Shanghai Stock Exchange Sci-Tech Innovation Board, known for short as STAR.
Manufacturers have been swarming into the Shanghai Stock Exchange to be listed on the Nasdaq-style STAR board three weeks after its official launch. Meet Hangke Technology (杭可科技), the fourth in the long list of applicants. According to media reports, the firm planned to issue 41 million shares priced at CNY 27.43 (USD 4.00) on July 3. And that would be the biggest float at this point as the three forerunners are reportedly going to charge less than four US dollars per share. Let’s see what’s special about this firm.
The company, which is headquartered in Hangzhou, Zhejiang province, was established in 2011. Its main business is concentrated around three industry verticals: energy storage, new energy vehicles (NEV) and digital products. The firm is providing auxiliary equipment for various public energy companies. With a R&D team of 273, Hangke holds a firm position along the supply chain.
Two groups of companies (the first and the second) were widely expected to choose the new board as an avenue of fundraising this week. And the Hangzhou-based manufacturer wasn’t on the list. Moreover, Hangke has made it to the board much more quickly than others (it first submitted the application on April 15). Accelerated screening and listing process apparently has something to do with the firm's good reputation and a rost outlook on its ex-post performance.
Its financial indicators appear strong. Revenue grew 59%, 88% and 44% in 2016, 2017 and 2018 respectively, with net profit hovering around 25% over this period. As a result, last year it exceeded CNY 1 billion in revenue for the first time. Projected post-IPO P/E ratio of Hangke (38.43) isn't as lofty as that of pioneers on the Shanghai bourse, but it is still way higher than the SSE average of 13.02 in November 2018.