Why the hype about TikTok rival Kuaishou?
Chinese video app company Kuaishou has debuted on the Hong Kong Stock Exchange, seeing the value of its shares almost triple after its initial public offering. What exactly is Kuaishou — and why are investors so excited?
Hong Kong highflier
What a day for Chinese video app Kuaishou. The company on Friday watched its shares triple in value on the Hong Kong Stock Exchange, following a $5.4 billion (€4.5 billion) initial public offering. It was the biggest IPO for an internet firm in nearly two years.
Closely watched
Tencent-backed Kuaishou's stellar debut comes amid a crackdown by Chinese authorities on tech companies in recent months. The firm's performance on Friday will no doubt be a sign of encouragement for TikTok owner ByteDance, which is planning its own listing.
Better than TikTok?
Well, at least Kuaishou is a very versatile app. Among many other things, you can watch videos and share small virtual gifts, tips and stickers. Investors believe the app is well-suited to tap into China's rural markets and smaller cities. Kuaishou makes most of its money from livestreaming e-commerce.
Big revenues, no profit
Kuaishou reported revenue of 40.7 billion yuan ($6.3 billion) in the nine months ended in September 2020. The figure included the cut it takes from users sharing virtual gifts. While the company's turnover appears impressive, the company is still struggling to make a profit. But Kuaishou expects to be profitable soon.
Users galore
The Kuaishou app (Kuaishou actually means "quick hands") has at least 260 million users. It says it aspires to become "the most-customer-obsessed company in the world." That would be a major achievement, given that the firm started out humbly in 2012 by offering a mobile app for making GIF animations.