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Blockbuster IPO: Shares Of TikTok’s Chief Rival Kuaishou Surge By 194% On First Day Of Trading, Firm Valued At $159 billion
Swarajya Staff
Feb 06, 2021, 05:44 PM | Updated 05:44 PM IST
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Shares in Kuaishou,the Chinese video app that competes with Bytedance-owned Tiktok, surged by 194 % on the first day of trading in Hong Kong exchange, valuing the company at a whopping $159 billion.
Kuaishou’s shares were more than 1,200 times oversubscribed by retail investors and the company raised $5.4bn in its initial public offering. Tencent holds a 17.8% stake in the company.
Kuaishou, co-founded by Su Hua, a former Google developer and Cheng Yixiao, who began his career as a software engineer at HP, commands more than 300 million daily active users, a meteoric from an average of just 67 million in 2017. Close to 300 millions check the app 10 times a day and spend an average of 86 minutes watching video on the app. It hosted nearly 1 billion live-streaming sessions in the first half of 2020.
The major stream of revenue comes from what the firm calls “live-stream gifting”. The company takes a portion of “tips” that viewers shower on their favourite live-streamers. The viewers shower the live streamers with gifts like virtual beer stickers or golden dragons. Online advertising constituted for relatively a small share of revenue - just 28% in the first half of 2020
Originally a GIF-making app in 2011, it later transformed it into a video sharing platform popular with users particularly in rural China. The app is used.
Kuaishou’s revenues grew from $1.3 billion in 2017 to $6.2 billion in the nine months ending 30 September 2020 but it still reported a loss of $1.1bn.
Kuaishou’s blockbuster IPO could set the stage for Bytedance, which is estimated to valued at $180bn as per latest round of private funding, to go public by listing in Hong Kong stock exchange later this year.
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