Shenzhen's 2024 First IPO: RoboSense Debuts in Hong Kong, Valued Near HKD 20 Billion

Technology, Industrials, Financials Author: Yiru Qian Editor: Yuehan LI Jan 06, 2024 03:17 AM (GMT+8)

At the issue price, RoboSense's IPO valuation exceeds HKD 19.3 billion, making it the world's highest-valued laser radar company.

HI

On January 5, 2024, RoboSense (2498:HK) successfully debuted on the Hong Kong Stock Exchange's Main Board, marking the first-ever "laser radar stock" in the region. J.P. Morgan and China Renaissance acted as joint sponsors for this listing, issuing 22.91 million shares, with 10% available for public offering at HKD 43 per share, raising around HKD 990 million.

As per the latest report, RoboSense closed at HKD 43 per share, boasting a market capitalization of HKD 19.316 billion. 

Reportedly, approximately 45% of the net proceeds will fund further research and development, expanding product pipelines, team enhancement, while 20% aims at fortifying manufacturing, testing, and validation capabilities. An additional 20% will boost sales and marketing efforts, 5% will explore potential strategic partnerships or alliances, with the remaining 10% allocated for general corporate purposes and operational needs.

Founded in 2014, RoboSense specializes in providing laser radar and perception solutions, focusing on laser radar hardware and AI perception software solutions. It caters to automotive OEMs, tier-one suppliers, diverse robotics, and clients in non-automotive sectors.

Public data reveals that by the first half of 2023, RoboSense served over 250 automotive OEMs and tier-one suppliers, up by more than 50 customers from Q1 2023, securing the top global spot in partner quantity by March 31, 2023.

In non-automotive sectors, RoboSense attended to nearly 2,200 robotics and non-automotive industry clients during the same period, an increase of about 200 customers from Q1 2023. According to China Insights Consultancy's 2022 sales revenue report, RoboSense holds the second spot globally and in China's laser radar solutions market, with approximately 7% and 20% market shares, respectively.

 

Their prospectus noted a significant surge in RoboSense's laser radar shipments from 7,200 units in 2020 to 16,300 in 2021, leaping remarkably to 57,000 units in 2022. Among these, 36,900 units were used in Advanced Driver Assistance Systems (ADAS), constituting 65% of the total shipments.

Despite escalating product sales, the company's financials show considerable growth. Revenues climbed from CNY 171 million in 2020 to CNY 530 million in 2022. However, RoboSense faces profit challenges, with losses ballooning from CNY 221 million to CNY 2.086 billion over the reporting period, accumulating total losses of approximately CNY 3.962 billion in three years. Even with increased sales in the first half of 2023, RoboSense incurred a net loss of CNY 768 million.

Since inception, RoboSense secured funding through 12 investment rounds, accumulating CNY 3.628 billion from over 30 prominent institutional and industrial investors, including BAIC Group, Cainiao, China Mobile, Huaxing New Economy Fund, Fosun RZ Capital, TCL, BYD, Yutong, Geely, Haitong Securities, Kinzon Capital, Oriental Fortune Capital, Xiaomi, Yunfeng Fund, and GAC Group.

Shenzhen Nanshan Strategic Emerging Industry Investment Co., Ltd. ("Nanshan Zhanxin Investment") emerged as a key cornerstone investor, subscribing to USD 100 million in RoboSense's latest offering.

Notably, the second-largest shareholder, Cainiao, and its related parties have a close association with RoboSense. As detailed in the prospectus, RoboSense's transactions involving sales, purchases, and service engagements with affiliated companies are interconnected within the Alibaba ecosystem, including Alibaba Cloud, Alibaba DAMO Academy, Tmall, and Taobao. Transactions from 2020 to 2022 totaled CNY 2.958 million, CNY 5.062 million, and CNY 5.061 million for selling goods and services, with expenses of CNY 15,000, CNY 6,000, and CNY 5,000 for purchasing Alibaba Cloud services.