ByteDance Rival Kuaishou Technology Files for Hong Kong IPO

(Bloomberg) -- Chinese video-sharing startup Kuaishou Technology filed an application for a Hong Kong initial public offering, raising hopes that the city will continue to see a wave of listings from fast-growing internet companies.

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Beijing Kwai Technology Co.'s app Kuaishou, or Kwai, is arranged for a photograph on a smartphone in Hong Kong, China, on Tuesday, Jan. 16, 2018. Tencent-backed Chinese startup Kuaishou is seeking to raise funds at about a $17 billion valuation, people familiar with the matter said, as it expands its video-streaming service to Southeast Asia.

Morgan Stanley, Bank of America Corp. and China Renaissance Holdings Ltd. are joint sponsors of the proposed IPO, according to pre-listing documents posted on the Hong Kong stock exchange’s website Thursday. While the filing didn’t provide a fundraising target, people familiar with the matter said in September that the potential share sale could raise as much as $5 billion.

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Kuaishou, or “fast hand,” is the biggest domestic rival to TikTok owner ByteDance Ltd.’s Chinese short-video app. Access to its Kuaishou App is free, with revenue generated from a cut of the tips users give to their favorite live-streaming performers.

Technology companies are continuing to pursue mega stock offerings in Hong Kong even after the collapse of the planned listing by billionaire Jack Ma’s fintech giant Ant Group Co. ByteDance is in discussions to raise a new $2 billion round of funding before listing some of its main businesses in Hong Kong, Bloomberg News reported Thursday.

Kuaishou established its popularity among users in the country’s smaller cities and rural areas, with people streaming slices of everyday life from harvesting corn to slurping noodles. It expanded to include audiences in bigger cities, and content ranging from people playing video games to teenagers lip-syncing songs.

The company has been increasingly expanding into advertising and e-commerce. Its apps had 776 million average monthly active users in the first half of the year, according to Thursday’s filing. Active users spent an average of more than 85 minutes daily on its main app.

Kuaishou swung to an adjusted net loss of 6.35 billion yuan ($961 million) in the six months through June, compared to an adjusted net profit of 1.23 billion yuan a year earlier. First-half sales roes 48% to 25.32 billion yuan, the filing shows.

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