IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

Equity Capital Markets

<p><a href="https://www.smartkarma.com/entities/ximalaya-inc" target="_blank" data-smartkarma-citation="entities:33232:1" rel="noopener">Ximalaya (XIMA US)</a> is the largest online audio platform in China as measured by average MAUs (monthly active users), total mobile listening time, and total revenues in 2020, according to CIC. Ximalaya also has the largest audio content library and the most audio content creators in China. <br>Ximalaya is backed by <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent (700 HK)</a> (5.4% of outstanding shares), <a href="https://www.smartkarma.com/entities/tal-education-group" target="_blank" data-smartkarma-citation="entities:1124:1" rel="noopener">TAL Education (TAL US)</a> and Sony Music Entertainment. Ximalaya has filed for an NYSE IPO to raise proceeds of $0.5-1.0 billion, according to press reports. </p><p>China is the world’s largest online audio market in terms of the number of online audio users. However, the number of mobile online audio MAUs (monthly active users) in China accounted for only 16.1% of total mobile Internet MAUs in 2020, according to CIC. China’s online audio market in terms of revenue is forecasted to grow from RMB13.1 billion in 2020 to RMB120.1 billion by 2025, representing a CAGR of 55.8%, according to CIC.</p><div class="content-highlight">
<p>At first glance, Ximalaya is well-positioned to benefit from this sizeable market opportunity. The strong user engagement, fast-paced revenue growth and declining loss margin suggest that Ximalaya is heading in the right direction. However, a closer look reveals concerning developments on several fronts.</p>
<p><a href="https://www.smartkarma.com/entities/lizhi-inc" target="_blank" data-smartkarma-citation="entities:28396:1" rel="noopener">Lizhi Inc (LIZI US)</a>, a peer, is trading around 50% below its IPO price which suggests that investors are not overly enthused by plays on the China online audio market. With sentiment on Chinese US listings weakening, we think that the negatives in the Ximalaya story warrant a pass.  </p>
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Ximalaya (XIMA US) is the largest online audio platform in China as measured by average MAUs (monthly active users), total mobile listening time, and total revenues in 2020, according to CIC. Ximalaya also has the largest audio content library and the most audio content creators in China.  Ximalaya is backed by Tencent (700 HK) (5.4% of outstanding shares), TAL Education (TAL US) and Sony Music Entertainment. Ximalaya has filed for an NYSE IPO to raise proceeds of $0.5-1.0 billion, according to press reports. China is the world’s largest online audio market in terms of the number of online audio users. However, the number of mobile online audio MAUs (monthly active users) in China accounted for only 16.1% of total mobile Internet MAUs in 2020, according to CIC. China’s online audio market in terms of revenue is forecasted to grow from RMB13.1 billion in 2020 to RMB120.1 billion by 2025, representing a CAGR of 55.8%, according to CIC.
At first glance, Ximalaya is well-positioned to benefit from this sizeable market opportunity. The strong user engagement, fast-paced revenue growth and declining loss margin suggest that Ximalaya is heading in the right direction. However, a closer look reveals concerning developments on several fronts.
Lizhi Inc (LIZI US), a peer, is trading around 50% below its IPO price which suggests that investors are not overly enthused by plays on the China online audio market. With sentiment on Chinese US listings weakening, we think that the negatives in the Ximalaya story warrant a pass.  


Head of Research, IPOs & Placements, Aequitas Research

Sumeet Singh

Head of Research, IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

<div><p><a href="https://www.smartkarma.com/entities/ximalaya-inc" target="_blank" data-smartkarma-citation="entities:33232:1" rel="noopener">Ximalaya (XIMA US)</a>, the largest online audio platform in China, is looking to raise around US$1bn in its US listing. </p></div><div>
<p>As of 1Q21, it had 250m average MAUs, which included 104m mobile MAUs through its apps and 146m MAUs through internet-of-things (IoT) and other third-party platforms. As per CIC, it accounted for 75% of total mobile listening time among all online audio platforms in China. It had 5.2m active content creators in 2020.</p>
<p>In our previous note,<a href="https://www.smartkarma.com/insights/ximalaya-pre-ipo-the-positives-a-whole-lot-of-listening" target="_blank" rel="noopener"> Ximalaya Pre-IPO - The Positives - A Whole Lot of Listening</a>, we covered the positive aspects of the deal.</p>
</div><div><p>In this note, we will talk about the not so pleasant aspects of the deal.</p></div>

Ximalaya (XIMA US), the largest online audio platform in China, is looking to raise around US$1bn in its US listing. 
As of 1Q21, it had 250m average MAUs, which included 104m mobile MAUs through its apps and 146m MAUs through internet-of-things (IoT) and other third-party platforms. As per CIC, it accounted for 75% of total mobile listening time among all online audio platforms in China. It had 5.2m active content creators in 2020.
In our previous note, Ximalaya Pre-IPO - The Positives - A Whole Lot of Listening, we covered the positive aspects of the deal.
In this note, we will talk about the not so pleasant aspects of the deal.

Equity Analyst, LightStream Research

Shifara Samsudeen, ACMA, CGMA

Equity Analyst

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

<p><a href="https://www.smartkarma.com/entities/ximalaya-inc" target="_blank" data-smartkarma-citation="entities:33232:1" rel="noopener">Ximalaya (XIMA US)</a>  a leading voice audio platform in China has filed for an IPO in the US and has a placeholder indication to raise about US$100m. According to news media outlets, Ximalaya could raise as much as US$500m through the IPO. According to CIC, Ximalaya was ranked the largest online audio platform in China in terms of average MAU, total mobile listening time and total revenues in 2020.</p><p>China is the world’s largest online audio market in terms of the number of online audio users. The online audio penetration rate (defined as mobile online audio MAU divided by total mobile internet MAU) in China is still below 20% compared to about 47% in the US. The online audio industry in China is forecasted to grow rapidly over the next few years driven by increasing supply of high-quality content, willingness to pay for content, rise of IoT and improving technologies.</p><p>Comprehensive online audio platforms such as Ximalaya (whose platform focuses on both content and interaction) are expected to enjoy strong growth and online audio platforms offer diverse monetisation streams such as membership subscription, advertising, virtual gifts in live streaming and education services.</p>

Ximalaya (XIMA US)  a leading voice audio platform in China has filed for an IPO in the US and has a placeholder indication to raise about US$100m. According to news media outlets, Ximalaya could raise as much as US$500m through the IPO. According to CIC, Ximalaya was ranked the largest online audio platform in China in terms of average MAU, total mobile listening time and total revenues in 2020.China is the world’s largest online audio market in terms of the number of online audio users. The online audio penetration rate (defined as mobile online audio MAU divided by total mobile internet MAU) in China is still below 20% compared to about 47% in the US. The online audio industry in China is forecasted to grow rapidly over the next few years driven by increasing supply of high-quality content, willingness to pay for content, rise of IoT and improving technologies.Comprehensive online audio platforms such as Ximalaya (whose platform focuses on both content and interaction) are expected to enjoy strong growth and online audio platforms offer diverse monetisation streams such as membership subscription, advertising, virtual gifts in live streaming and education services.

Ximalaya IPO: Diversified Revenue Channels with Further Potential to Monetise Users and Content

<p><a href="https://www.smartkarma.com/entities/ximalaya-inc" target="_blank" data-smartkarma-citation="entities:33232:1" rel="noopener">Ximalaya (XIMA US)</a>, the largest online audio platform in China, is looking to raise around US$1bn in its US listing. </p><p>As of 1Q21, it had 250m average MAUs, which included 104m mobile MAUs through its apps and 146m MAUs through internet-of-things (IoT) and other third-party platforms. As per CIC, it accounted for 75% of total mobile listening time among all online audio platforms in China. It had 5.2m active content creators in 2020.</p><p>In this note, we will talk about the positive aspects of the deal.</p>

Ximalaya (XIMA US), the largest online audio platform in China, is looking to raise around US$1bn in its US listing. As of 1Q21, it had 250m average MAUs, which included 104m mobile MAUs through its apps and 146m MAUs through internet-of-things (IoT) and other third-party platforms. As per CIC, it accounted for 75% of total mobile listening time among all online audio platforms in China. It had 5.2m active content creators in 2020.In this note, we will talk about the positive aspects of the deal.

Ximalaya Pre-IPO - The Positives - A Whole Lot of Listening

China

Ximalaya operates as an audio sharing platform. The Company provides audiobooks, music, variety entertainment programs, news, and other audio contents. Ximalaya also provides technical consulting services.

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Ximalaya (XIMA US)

Ximalaya IPO Initiation: Out of Tune

At first glance, Ximalaya is well-positioned to benefit from the sizeable China online audio market opportunity. However, a closer look reveals...

Arun George

Ximalaya Pre-IPO - The Negatives

Ximalaya (XIMA US), the largest online audio platform in China, is looking to raise around US$1bn in its US listing. In this note, we will talk...

Sumeet Singh

Ximalaya IPO: Diversified Revenue Channels with Further Potential to Monetise Users and Content

Ximalaya’s extensive audio content library and steadily growing user base has offered great opportunities to pursue further revenue growth.

Shifara Samsudeen, ACMA, CGMA

Ximalaya Pre-IPO - The Positives - A Whole Lot of Listening

Ximalaya (XIMA US), the largest online audio platform in China, is looking to raise around US$1bn in its US listing. In this note, we'll talk about...

Sumeet Singh

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