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Kingsoft Cloud IPO: A Few Inherent Risks, But We Are Broadly Positive

Equity Analyst, LightStream Research

Supun Walpola

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.

Equity Capital Markets

<ul>
<li>In our IPO initiation note, <a href="https://www.smartkarma.com/insights/kingsoft-cloud-ipo-a-few-inherent-risks-but-we-are-broadly-positive" target="_blank" data-smartkarma-citation="insights:38914" rel="noopener">Kingsoft Cloud IPO: A Few Inherent Risks, But We Are Broadly Positive</a>, we suggested that KC’s gross loss could be stemming from undercutting its prices to attract customers.</li>
<li>Therefore, we believe KC’s path to profitability would largely depend on its ability to raise prices for its customers over the next few years. </li>
<li>In this post IPO note, we look to value the impact of these potential price hikes. </li>
</ul>


In our IPO initiation note, Kingsoft Cloud IPO: A Few Inherent Risks, But We Are Broadly Positive, we suggested that KC’s gross loss could be stemming from undercutting its prices to attract customers.
Therefore, we believe KC’s path to profitability would largely depend on its ability to raise prices for its customers over the next few years. 
In this post IPO note, we look to value the impact of these potential price hikes. 


Kingsoft Cloud: Valuing the Impact of Potential Price Hikes; Expect C.30% Upside in the Medium Term