Xiaomi Corporation (1810.HK)

[CY09]

"That compares with a net loss of 43.89 billion yuan for the whole of 2017, according to its draft prospectus.

When one-off items are excluded, Xiaomi said it made a net profit of 1.04 billion yuan in the first quarter, compared with 3.9 billion yuan for the whole of 2017."

Last year excluding one offs, Xiaomi would have made 3.9 billion instead of a 43.89 billion yuan loss.

This quarter excluding one offs, Xiaomi said it would make a 1.04 billion yuan profit instead of a 7 billion yuan loss.

As potential investor, I am curious to know how many one-offs are there to go. Please show the cashflow statement for a better valuation of this 100 billion company. If one observes the cash flow of the company purely from operations, Xiaomi is not generating much operating cashflow in the past 3 years. Based on last FY alone, the company is generating about 7 bil yuan (or US$1 billion) in op cash flow before wc changes, unless we are so optimistic that Xiaomi's business will grow much larger, a US$100 billion market cap is not plausible

http://www.hkexnews.hk/APP/SEHK/2018/201...030005.pdf

[specuvestor]

"That compares with a net loss of 43.89 billion yuan for the whole of 2017, according to its draft prospectus.

When one-off items are excluded, Xiaomi said it made a net profit of 1.04 billion yuan in the first quarter, compared with 3.9 billion yuan for the whole of 2017."

Last year excluding one offs, Xiaomi would have made 3.9 billion instead of a 43.89 billion yuan loss.

This quarter excluding one offs, Xiaomi said it would make a 1.04 billion yuan profit instead of a 7 billion yuan loss.

As potential investor, I am curious to know how many one-offs are there to go. Please show the cashflow statement for a better valuation of this 100 billion company. If one observes the cash flow of the company purely from operations, Xiaomi is not generating much operating cashflow in the past 3 years. Based on last FY alone, the company is generating about 7 bil yuan (or US$1 billion) in op cash flow before wc changes, unless we are so optimistic that Xiaomi's business will grow much larger, a US$100 billion market cap is not plausible

http://www.hkexnews.hk/APP/SEHK/2018/201...030005.pdf

Was thinking about same thing. Most of the one-off relates to Equity & Pref shares investments and Conv Pref shares valuation loss in 2017. The cashflow in section I-92 which shows operating cash dropped from RMB4.74b to RMB0.5b with huge increase in WC

[cyclone]

Qualcomm becomes sole foreign cornerstone investor in Chinese smartphone maker Xiaomi with US$100m investment

Xie Yu
PUBLISHED : Thursday, 21 June, 2018, 12:01pm
UPDATED : Thursday, 21 June, 2018, 3:15pm

Qualcomm is the only foreign cornerstone investor in Xiaomi, after the Chinese smartphone maker secured a US$100 million investment from the US chip maker for its IPO that will value it as high as US$70 billion, according to a term sheet seen by the South China Morning Poston Thursday.

Qualcomm investment makes it the only foreign player among its seven cornerstone investors, who will lock up their investments in the company for six months.

Qualcomm, one of the first suppliers of microchips for Xiaomi’s smartphones, started investing in the Chinese company as early as 2011, taking part in the second round of funding.

Sources who attended Xiaomi’s road show at the Shangri-La hotel in Hong Kong said foreign funds stayed away from the cornerstone investment because they were concerned about the company’s high valuation.

“We are still not fully convinced it is an internet firm,” a source said. “It is just too expensive for us.”

China Mobile, the biggest telecom operator in China will also invest US$100 million in Xiaomi.

CICFH Entertainment, a state-backed industrial fund, will be the biggest cornerstone investor with an input of US$192 million.

Apart from these, state-backed CDB Entertainment will invest US$66 million, Grantwell Fund under property giant Poly Group will invest US$32 million, Celestial Ocean Investment under logistics giant SF Express will invest US$30 million, and China Merchants Group will invest US$28 million.

More details in http://www.scmp.com/business/companies/a...e#comments

[cyclone]

Xiaomi, the world’s No 4 smartphone maker, says it can grow tenfold to warrant US$6.1 billion IPO

Laura He, Xie Yu, Yingzhi Yang
PUBLISHED : Saturday, 23 June, 2018, 3:41pm
UPDATED : Saturday, 23 June, 2018, 5:50pm

Lei Jun, the entrepreneur who took a mere seven years to create the world’s fourth-largest phone maker, put on a brave face as he presented the largest global stock offer of 2018 to retail investors, even as he pushed back against the Chinese government’s strong-arm tactics to split his fundraising.

Speaking during a 90-minute presentation and press conference at the Four Seasons Hotel in Hong Kong, Lei reiterated that Xiaomi is a “new species” of a company, because it’s a smartphone maker that also sells hardware through new retail channels and provides internet services.

“Xiaomi is a new species, in a class of its own,” Lei said in Mandarin Chinese. “Rather than explaining whether it is a hardware maker or an internet firm, I would say Xiaomi is an all-rounded company that can do well in all three aspects of hardware, e-commerce and retail, and internet services.”

Xiaomi’s identity remains the key in Lei’s plan to raise around US$6.1 billion from Hong Kong’s equity market, as institutional investors were lukewarm about the company’s valuation during a roadshow this week. The company plans to offer 2.179 billion shares at between HK$17 and HK$22 billion per share, raising as much as HK$47.95 billion (US$6.1 billion) on June 25, for shares to begin trading on the Hong Kong stock exchange on July 9, according to a press statement today.

That would value the firm at between HK$54 billion to HK$70 billion. Based on the indicative price range, the firm’s expected price to earnings ratio is between 39.6 to 51.3.

The business model, which Lei dubs the “triathlon” of technology, works this way: Xiaomi would sell hardware at a profit margin that’s capped at 5 per cent, using an efficient and cost-effective new retail channel to attract as many users as possible. The company would then provide engaging internet services for users, to create new sources of revenue.

More details in http://www.scmp.com/business/companies/a...t#comments

[cyclone]

Billionaire Trio Grabs a Slice of Xiaomi’s IPO

Bloomberg News
June 26, 2018, 11:07 AM GMT+8

China’s richest people are buying into Xiaomi Corp.’s imminent Hong Kong initial public offering, conferring their imprimatur on the world’s biggest coming-out party in two years.

Former CK Hutchison Holdings Ltd. Chairman Li Ka-shing, known in the former British colony as “superman” for his business acumen, plans to invest $30 million for an unknown slice of the Chinese smartphone maker, according to people familiar with the matter. Alibaba founder Jack Ma and Tencent Chairman Pony Ma -- the country’s two richest persons -- have also agreed to take stakes in Xiaomi, said the people, who asked not to be identified discussing personal investments.

The billionaire triumvirate join a group of big corporate names backing an IPO that could raise as much as $6.1 billion -- the world’s biggest first-time share sale since Postal Savings Bank of China Co. raised $7.6 billion in Hong Kong in 2016. China Mobile Ltd., the nation’s biggest wireless carrier, and U.S. chipmaker Qualcomm Inc. are among those that’ve agreed to participate as cornerstone investors, according to terms for the deal obtained by Bloomberg.

More details in https://www.bloomberg.com/news/articles/...ent-of-ipo

[Wildreamz]

Link if embedding doesn't work: https://www.youtube.com/watch?v=dAaxW_pT_mA

This is a big deal. These 3 people has an amazing track record. 

Personally I wasn't too enthusiastic about Xiaomi's IPO because I feel equipment manufacturers like them are a dime a dozen in China. Also thought their brand positioning and business strategy is suspect.

Worth a second look.

Prospectus: http://www.hkexnews.hk/APP/SEHK/2018/201...030005.pdf

[kelvesy]

Isn't Xiaomi facing a number of lawsuits for copying designs? I think it is going to be a very challenging market for the company.

[cyclone]

Xiaomi’s value cut by almost half as smartphone maker prices IPO at the lower end of the price range

Laura He
PUBLISHED : Friday, 29 June, 2018, 1:04pm
UPDATED : Friday, 29 June, 2018, 2:29pm

Xiaomi, which was billed as the world’s largest technology fundraising this year, has had to pare back its fundraising ambitions further as it priced its shares at the lower end of a price range, trimming its IPO size by nearly a quarter to HK$37 billion (US$4.7 billion).

The Beijing-based smartphone maker priced its stock at HK$17 per share, the lower end of the price range of HK$17 to HK$22, according to several bankers familiar with the matter. That would value the eight-year old company founded by Lei Jun at US$54 billion, about half of the US$100 billion sought.

Trading of Xiaomi’s shares will commence on July 9 on the main board of the Hong Kong stock exchange.

The company started taking orders from institutional investors last week, with three of China’s richest tycoons - Li Ka-shing, Jack Ma Yun, and Pony Ma Huateng - pouring their personal fortunes to back the firm. Li, the former chairman of Hong Kong’s largest conglomerate CK Hutchison Holdings, bought US$30 million of Xiaomi’s shares, said his company’s co-managing director Canning Fok Kin-ning.

On the retail front, the company received 109,446 applications for 1.03 billion shares at the end of a four-day offer period, with the retail subscription overbought by 8.5 times, compared with 109 million shares available in the tranche.

More details in http://www.scmp.com/business/companies/a...r#comments

[cyclone]

Xiaomi sputters on Hong Kong trading debut as first company to use new listing rules
What was billed as China’s most keenly anticipated stock sale of 2018 struggled as investors worried over risky tech stocks at a time of trade tensions

Laura He
PUBLISHED : Monday, 09 July, 2018, 9:24am
UPDATED : Monday, 09 July, 2018, 6:18pm

Xiaomi, the first company to list in Hong Kong with dual-class shares, had an inauspicious start on Monday, as its shares fell below the initial offer price amid investor concerns about the company’s valuation and risky tech stocks in general on the back of an unfolding US-China trade war.

Xiaomi has a weighted voting rights (WVR) structure, or dual-class shares, which allows founders or executives to control the company even with minority shareholdings. The structure has been adopted by many tech companies, including Google, Facebook and Alibaba.

Xiaomi is the first of such firms to go public in Hong Kong after the city’s bourse launched a listing regime reform in April aiming to lure more tech listings.
...
Xiaomi had already priced what was once billed as the world’s largest initial public offering this year at HK$17, the bottom of an initial HK$17 to HK$22 price range, after a lukewarm investor response. The shares opened on Monday at HK$16.60, before sliding as much as 6 per cent to HK$16.

The stock closed at HK$16.80, off 1.2 per cent, while Hong Kong’s benchmark Hang Seng Index ended up 1.3 per cent.

More details in https://www.scmp.com/business/companies/...-trade-war

[cyclone]

Xiaomi passes Chinese internet giant JD.com’s market cap within three days of listing
The change in Xiaomi’s fortunes has benefited some investors, including Xiaopeng Motors’ founder He Xiaopeng

Laura He
PUBLISHED : Wednesday, 11 July, 2018, 12:57pm
UPDATED : Wednesday, 11 July, 2018, 4:58pm

For the first time albeit briefly, Xiaomi passed JD.com in market capitalisation on Wednesday, as it aims to join the league of China’s biggest internet players such as Alibaba Group Holding, Tencent Holdings and Baidu.

Xiaomi jumped by up to 4 per cent to a high of HK$19.8 on Wednesday morning, which took its market cap to HK$443 billion (US$56.4 billion), above Nasdaq-listed JD.com’s US$55.4 billion on Tuesday. It closed unchanged from previous day at HK$19, with a HK$425 billion market cap.

The Hong Kong market was in decline on Wednesday. The Hang Seng Index ended down 1.3 per cent at 28,311.69, after US President Donald Trump ramped up the US-China trade war and released a list of additional goods worth US$200 billion that may face 10 per cent tariffs.

Xiaomi, which has been presenting itself as an “internet firm” rather than a hardware maker, has had a roller-coaster ride since its debut on Monday. It staged a dramatic turnaround on Tuesday to surge 13 per cent to close at HK$19, after falling below its offer price in the previous session.

The rise came after index compilers FTSE Russell and Hang Seng Indexes Company announced separately they will include the stock in their widely tracked indices. From July 16, Xiaomi will join a number of FTSE indices, including FTSE China A50 Index, which is tracked by nearly US$7 billion worth of funds globally.

From July 23, Xiaomi will also be added to the Hang Seng Composite Index (HSCI), which could allow mainland investors to buy the stock via the stock connect schemes as soon as this month.

More details in https://www.scmp.com/business/investor-r...e-internet