Live streaming platform Inke plans to raise HK$1.2 billion in IPO

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China’s mobile live streaming platform Inke plans to go public in Hong Kong with an offer price per share between HK$3.85 to HK$5. According to the company’s filing, it expects to raise HK$1.21 billion. Shares will start trading on July 12.

According to the filing, the company is the second largest mobile live streaming platform in China in terms of revenue in 2017, with a revenue of RMB 3.94 billion ($595 million) making up 15.3% of the market.

Inke’s monthly active users peaked in the last quarter of 2016 and experienced a 26% decrease at the beginning of 2017. The number of users fell from 30 million to 22 million. Though the number’s increasing since the second quarter of 2017, it never returned to the peak. In the first quarter of 2018, monthly active users were 25.3 million.

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Although still not profitable, the company’s loss for the year narrowed to RMB 239 million in 2017 from RMB 1.5 billion in 2016 after cutting sales and marketing expenses. The adjusted profit increased to RMB 791 million from RMB 568 million. However, the revenues decreased to RMB 3.9 billion in 2017 from RMB 4.3 billion in 2016.

The company generates most of their revenues from the live streaming business where users can purchase Inke Diamonds, their virtual currency, to purchase virtual items and other services. Virtual items that live steamers received are converted to Inke Coins. Up to a certain amount, they can be exchanged for RMB. According to the company, live streamer costs amount to 55% of their live streaming revenue.

Inke first filed its IPO in March without specifying how much it planned to raise.

Earlier this year, live streaming platform Huya (虎牙) was listed on New York Stock Exchange on May 29. Shares of Huya increased to $31 from $23.27 when the shares started trading. Two other live steaming platforms, Douyu(斗鱼) and Huajiao(花椒) were rumored to plan their IPOs in Hong Kong.