Finance

Investment Bank China Renaissance Is Reborn on First-Quarter IPO Boom

Company’s deal volume rose six-fold in first three months of 2021, as it helped to underwrite Kuaishou’s blockbuster Hong Kong listing （Photo above of Renaissance founder Bao Fan） Key points: China Renaissance has reported a banner first-quarter on an explosion of IPOs by Chinese tech companies The investment bank faces several headwinds, including growing movement by big Wall Street banks into its backyard By Ben Livesey Boutique dealmaker and private equity investor China Renaissance Holdings Ltd. (1911.HK) has been going gangbusters this year. The self-proclaimed one-stop shop for Chinese “new…

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Daqo’s Secondary China IPO: Good for Daqo, But Less Clear for U.S. Shareholders

Company’s plan for dual listing on Shanghai’s STAR Market moves ahead with submission to Chinese securities regulator Key points: Daqo is at the forefront of a group of New York-listed private Chinese firms seeking secondary listings on China’s 2-year-old STAR Market The dual listing should benefit the company, but could have relatively little upside for its New York-listed shares By Doug Young Today we break from our usual discussion of corporate strategy and instead examine a growing financial strategy of Chinese companies: listing in multiple markets at once, usually combinations…

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Loan Facilitator 360 DigiTech’s Profit Soars, as Investor Focus Elsewhere

Fintech’s first-quarter profit rose by factor of seven on its automation drive, even as company acknowledged recent meeting with top financial regulators    Key points: 360 DigiTech is executing well on its strategy to lower costs through growing automation of its loan facilitating services The company’s shares could remain under pressure until China’s financial regulators announce expected new round of regulations for high-tech loan facilitators By Doug Young It’s hard to focus on your business when there’s a wild tiger in the room and no one knows exactly if and…

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BIT Mining’s Rapid Move into Crypto Space Shows Early Signs of Depth

Former lottery ticket seller’s stock follows highly volatile bitcoin price, as its new business model shows positive results Key points: To survive in its new form as crypto miner BIT Mining must grow as quickly as possible, control costs, and efficiently integrate its acquisitions The company must also steer clear of Chinese oversight, become greener, and accept that its destiny will often be shaped by forces beyond its control By Ben Livesey The recently minted BIT Mining Ltd. (NYSE: BTCM) is doing what it says on the label – mining…

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Yixin Drives Out From Fintech Maelstrom

Former auto lender issues upbeat first-quarter guidance after its transition to loan facilitator Key points: Tencent-backed auto-financier Yixin’s strong first-quarter update shows it’s making progress in transforming from lender to loan facilitator Company’s position remains tenuous as China reportedly considers new regulations on such loan facilitators By Ben Livesey Yixin Group Ltd. (2858.HK), the online auto financier backed by internet giant Tencent, has given investors reason to cheer after recently posting a bullish first quarter update. The announcement provided a lift for the much-scrutinized fintech sector, as well as for…

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Noah Holdings Finds Resurgent Riches in China’s Wealthy

One of the nation’s oldest private wealth managers posts record business in first quarter, but forecasts more modest profit gains for all 2021  Key points: Asset manager Noah Holdings is focusing on higher-margin, affluent customers over more mainstream ones The strategy could position it for stronger growth in the next few years as it emerges as one of the survivors from China’s recent P2P cleanup   By Doug Young Forget the Average Joe and focus on the rich. That’s the message coming in the latest earnings report from Noah Holdings Ltd.…

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Online Insurance Broker Waterdrop Makes Splash, Then Crash, in New York IPO

Company raises $360 million after pricing shares at the top of their range, only to see stock tank nearly 20% in trading debut Key points: Waterdrop’s position as a middleman insurance broker should help protect it from regulatory risk in China’s sensitive financial services sector The company’s strong IPO pricing, followed by a sharp selloff in its trading debut, reflect investor indecision about its growth prospects  By Doug Young Middlemen are creatures of little or no respect, often seen as parasites that profit from a gap between businesses and the…

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UP Fintech Lurks Behind Launch of New ‘Blank Check Company’

Company better known as Tiger Brokers is getting a growing slice of its revenue by helping Chinese firms list in the U.S. and Hong Kong Key points: UP Fintech’s new SPAC listing reflects the growing importance of investment banking to its business mix The company is emerging as a strong second choice behind the larger Futu for investors seeking to tap Chinese demand for overseas-listed stocks By Doug Young An announcement last week about an IPO from a company called TradeUP Global Corp. (Nasdaq: TUGCU) had all the markings of…

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Cryptocurrency Wannabe Ebang Mines Investors for Funds with Talk of Transformation

Mining machine manufacturer moves into exchange operation and mining business in bid to pump up modest revenue base Major takeaways: Ebang is a company trying to transform from a minor mining equipment maker to a diversified cryptocurrency product and service provider The company’s high market value compared with its modest revenue makes it look highly speculative as an investment By Doug Young The recent explosion in bitcoin has created a gold rush among Chinese startups, drawing newcomers into the space and leading existing players to expand into new related areas.…

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LexinFintech Finds Weaker Growth, Better Profits in Business Shift

Key takeaways: LexinFintech is transforming from a direct lender to a middleman that facilitates micro loans between banks and customers The transformation is hurting the company’s revenues due to the new model’s lower fees. But profitability is improving with lower risk levels By Doug Young We’ll start off the new week with a story that could be called, “A Tale of Two Fintechs.” A couple of weeks ago we looked at the story of FinVolution Group (NYSE: FINV), whose stock nearly doubled in a single day after it reported financial…

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