{"id":6934,"date":"2023-10-27T07:26:22","date_gmt":"2023-10-27T07:26:22","guid":{"rendered":"https:\/\/demo5.dedicatedhost247.com\/zexo\/shares-of-tencent-backed-jt-express-fall-in-lackluster-hong-kong-debut\/"},"modified":"2023-10-27T07:26:22","modified_gmt":"2023-10-27T07:26:22","slug":"shares-of-tencent-backed-jt-express-fall-in-lackluster-hong-kong-debut","status":"publish","type":"post","link":"https:\/\/demo5.dedicatedhost247.com\/zexo\/shares-of-tencent-backed-jt-express-fall-in-lackluster-hong-kong-debut\/","title":{"rendered":"Shares of Tencent-backed J&#038;T Express fall in lackluster Hong Kong debut"},"content":{"rendered":"<p> <br \/>\n<\/p>\n<div id=\"RegularArticle-ArticleBody-6\" data-module=\"ArticleBody\" data-test=\"articleBody-2\" data-analytics=\"RegularArticle-articleBody-6-2\"><span class=\"HighlightShare-hidden\" style=\"top:0;left:0\"\/><\/p>\n<div class=\"InlineImage-imageEmbed\" id=\"ArticleBody-InlineImage-107324180\" data-test=\"InlineImage\">\n<div class=\"InlineImage-wrapper\">\n<div>\n<p>Courier handing over package asking female customer to do electronic signature, delivering, receiving, efficiency<\/p>\n<p>10&#8217;000 Hours | Digitalvision | Getty Images<\/p>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"group\">\n<p>Shares of Indonesia&#8217;s J&amp;T Express fell 1.33% when it went public on Friday.<\/p>\n<p>The logistics service provider traded at 11.84 Hong Kong dollars ($1.51) on Friday morning, after opening at HK$12.<\/p>\n<p>The HK$3.92 billion ($500 million) IPO is the second largest listing in Hong Kong this year, after premium Chinese liquor company\u00a0<span class=\"QuoteInBody-quoteNameContainer\" data-test=\"QuoteInBody\" id=\"RegularArticle-QuoteInBody-1\"><a href=\"https:\/\/www.cnbc.com\/quotes\/undefined\/\">ZJLD Group<\/a><span class=\"QuoteInBody-inlineButton\"><span class=\"AddToWatchlistButton-watchlistContainer\" id=\"-WatchlistDropdown\" data-analytics-id=\"-WatchlistDropdown\"><button class=\"AddToWatchlistButton-watchlistButton\" aria-label=\"Add To Watchlist\" data-testid=\"dropdown-btn\"><span class=\"AddToWatchlistButton-addWatchListFromTag\"\/><\/button><\/span><\/span><\/span>.\u00a0The Chinese &#8220;baijiu&#8221; maker, backed by <span class=\"QuoteInBody-quoteNameContainer\" data-test=\"QuoteInBody\" id=\"RegularArticle-QuoteInBody-2\"><a href=\"https:\/\/www.cnbc.com\/quotes\/KKR\/\">KKR<\/a><span class=\"QuoteInBody-inlineButton\"><span class=\"AddToWatchlistButton-watchlistContainer\" id=\"-WatchlistDropdown\" data-analytics-id=\"-WatchlistDropdown\"><button class=\"AddToWatchlistButton-watchlistButton\" aria-label=\"Add To Watchlist\" data-testid=\"dropdown-btn\"><span class=\"AddToWatchlistButton-addWatchListFromTag\"\/><\/button><\/span><\/span><\/span>, plunged nearly 18% on their <a href=\"https:\/\/www.cnbc.com\/2023\/05\/05\/hong-kongs-ipo-market-still-waiting-to-rebound-after-recent-flop.html\">first day of trading<\/a> on April 27.<\/p>\n<p>Investors include Chinese tech giant <span class=\"QuoteInBody-quoteNameContainer\" data-test=\"QuoteInBody\" id=\"RegularArticle-QuoteInBody-4\"><a href=\"https:\/\/www.cnbc.com\/quotes\/700-HK\/\">Tencent<\/a><span class=\"QuoteInBody-inlineButton\"><span class=\"AddToWatchlistButton-watchlistContainer\" id=\"-WatchlistDropdown\" data-analytics-id=\"-WatchlistDropdown\"><button class=\"AddToWatchlistButton-watchlistButton\" aria-label=\"Add To Watchlist\" data-testid=\"dropdown-btn\"><span class=\"AddToWatchlistButton-addWatchListFromTag\"\/><\/button><\/span><\/span><\/span>, U.S.-based venture capital firm\u00a0Sequoia, Chinese private equity firm Boyu, SF Express and Singapore&#8217;s sovereign wealth fund Temasek.<\/p>\n<p>J&amp;T Express is listing in an uncertain economic environment, characterized by\u00a0hiking\u00a0inflation, high interest rates and ongoing conflict such as the Israel-Hamas war and Ukraine invasion.<\/p>\n<p>&#8220;In the third quarter of 2023, global IPO activities remained sluggish due to macroeconomic and geopolitical uncertainties. Hong Kong&#8217;s global IPO ranking dropped to eighth following a historically slow third quarter,&#8221; said <a href=\"https:\/\/kpmg.com\/cn\/en\/home\/media\/press-releases\/2023\/10\/hk-ipo-market-faces-sluggish-performance-amist-market-challenges.html\" target=\"_blank\" rel=\"noopener\">KPMG in a report<\/a> published on Oct. 9.<\/p>\n<p>&#8220;The Hong Kong market has not recovered as much as we would like,&#8221; Irene Chu, partner at KPMG\u00a0China, told CNBC, highlighting that the third quarter &#8220;continued to be very soft.&#8221;<\/p>\n<p>J&amp;T had initially aimed to raise at least $1 billion in the IPO but halved the target amount on weak investor demand, according to <a href=\"https:\/\/www.reuters.com\/article\/jt-global-express-ipo-idUSL1N3BL0O1\" target=\"_blank\" rel=\"noopener\">Reuters<\/a>.<\/p>\n<p>Companies that want to go public have &#8220;become more realistic&#8221; in their pricing, said Ringo Choi, Asia-Pacific IPO leader at EY. &#8220;The IPO pricing is dropping significantly by more than 50% or even 70%.&#8221;<\/p>\n<\/div>\n<div role=\"region\" aria-labelledby=\"Placeholder-ArticleBody-Video-107287250\">\n<div role=\"button\" tabindex=\"0\" id=\"Placeholder-ArticleBody-Video-107287250\" class=\"PlaceHolder-wrapper\" data-vilynx-id=\"7000312096\" data-test=\"VideoPlaceHolder\">\n<div class=\"InlineVideo-videoEmbed\" id=\"InlineVideo-0\" data-test=\"InlineVideo\">\n<div class=\"InlineVideo-wrapper\">\n<div class=\"InlineVideo-inlineThumbnailContainer\"><span class=\"InlineVideo-videoButton\"\/><span\/><\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"group\">\n<p>China is J&amp;T&#8217;s largest market, where it delivered nearly 83% of its total parcels last year, serving the likes ecommerce giants like <span class=\"QuoteInBody-quoteNameContainer\" data-test=\"QuoteInBody\" id=\"RegularArticle-QuoteInBody-7\"><a href=\"https:\/\/www.cnbc.com\/quotes\/PDD\/\">Pinduoduo<\/a><span class=\"QuoteInBody-inlineButton\"><span class=\"AddToWatchlistButton-watchlistContainer\" id=\"-WatchlistDropdown\" data-analytics-id=\"-WatchlistDropdown\"><button class=\"AddToWatchlistButton-watchlistButton\" aria-label=\"Add To Watchlist\" data-testid=\"dropdown-btn\"><span class=\"AddToWatchlistButton-addWatchListFromTag\"\/><\/button><\/span><\/span><\/span> and Alibaba&#8217;s Taobao and Tmall. It held a 10.9% market share by parcel volume in 2022, the company said in its <a href=\"https:\/\/www1.hkexnews.hk\/listedco\/listconews\/sehk\/2023\/1016\/2023101600009.pdf\" target=\"_blank\" rel=\"noopener\">prospectus<\/a>, citing Frost &amp; Sullivan.<\/p>\n<p>In May, it acquired China-based Fengwang Express for 1.18 billon yuan from largest domestic player SF Express, building on its acquisition of <a href=\"https:\/\/www.prnewswire.com\/news-releases\/best-inc-agrees-to-sell-its-express-business-in-china-301411811.html\" target=\"_blank\" rel=\"noopener\">express delivery business<\/a> from Chinese logistics firm Best\u00a0in late 2021.<\/p>\n<p>The Indonesian logistics provider delivered a total of more than 14.5 billion parcels in 2022 across China and Southeast Asia, up from 11.5 billion in 2020. In Southeast Asia, it is the largest operator with a 22.5% market share in terms of parcel volume, based on Frost &amp; Sullivan data. <span class=\"QuoteInBody-quoteNameContainer\" data-test=\"QuoteInBody\" id=\"RegularArticle-QuoteInBody-10\"><a href=\"https:\/\/www.cnbc.com\/quotes\/BABA\/\">Alibaba<\/a><span class=\"QuoteInBody-inlineButton\"><span class=\"AddToWatchlistButton-watchlistContainer\" id=\"-WatchlistDropdown\" data-analytics-id=\"-WatchlistDropdown\"><button class=\"AddToWatchlistButton-watchlistButton\" aria-label=\"Add To Watchlist\" data-testid=\"dropdown-btn\"><span class=\"AddToWatchlistButton-addWatchListFromTag\"\/><\/button><\/span><\/span><\/span>-owned Lazada, GoTo&#8217;s e-commerce arm Tokopedia and <span class=\"QuoteInBody-quoteNameContainer\" data-test=\"QuoteInBody\" id=\"RegularArticle-QuoteInBody-11\"><a href=\"https:\/\/www.cnbc.com\/quotes\/SE\/\">Sea Limited<\/a><span class=\"QuoteInBody-inlineButton\"><span class=\"AddToWatchlistButton-watchlistContainer\" id=\"-WatchlistDropdown\" data-analytics-id=\"-WatchlistDropdown\"><button class=\"AddToWatchlistButton-watchlistButton\" aria-label=\"Add To Watchlist\" data-testid=\"dropdown-btn\"><span class=\"AddToWatchlistButton-addWatchListFromTag\"\/><\/button><\/span><\/span><\/span>&#8216;s Shopee, are among its customers, the prospectus showed.<\/p>\n<\/div>\n<div class=\"group\">\n<div class=\"RelatedContent-relatedContent\" id=\"RegularArticle-RelatedContent-1\">\n<div class=\"RelatedContent-container\">\n<div class=\"RelatedContent-nonCollapsibleContent\">\n<h2 class=\"RelatedContent-header\">Read more about tech and crypto from CNBC Pro<\/h2>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"group\">\n<p>It posted a net profit of $1.57 billion in 2022 but <a href=\"https:\/\/www1.hkexnews.hk\/listedco\/listconews\/sehk\/2023\/1016\/2023101600009.pdf\" target=\"_blank\" rel=\"noopener\">went into the red<\/a> in the first six months of this year Net losses came in at $666.8 million, due to gross losses from operations in China and new market expansion in 2022, among others.<\/p>\n<p>&#8220;In the long term, to continue to realize our revenue potential and achieve profitability, we plan to further grow our parcel volume and market share, maintain a flexible pricing strategy, control costs, narrow gross loss and improve gross margin, and enhance operating leverage,&#8221; said J&amp;T in its prospectus.<\/p>\n<\/div>\n<h2 class=\"ArticleBody-subtitle\"><a id=\"headline0\"\/>&#8216;Immaterial&#8217; impact from TikTok Shop ban<\/h2>\n<div class=\"group\">\n<p>Analysts warn that <a href=\"https:\/\/www.cnbc.com\/2023\/10\/04\/tiktok-halts-e-commerce-service-in-indonesia-following-ban.html\">TikTok Shop&#8217;s ban in Indonesia<\/a>, which disallows social media platforms from facilitating e-commerce purchases, could impact J&amp;T Express.<\/p>\n<p>TikTok Shop is the e-commerce feature of popular short-video app TikTok.<\/p>\n<p>&#8220;There is some sharp short-term pain for J&amp;T in Indonesia because of the\u00a0TikTok Shop ban, as J&amp;T was (profitably) carrying the\u00a0majority of the TikTok Shop&#8217;s millions of orders a day in Indonesia prior to the ban,&#8221; said Momentum Works in a Oct. 17 <a href=\"https:\/\/thelowdown.momentum.asia\/our-thoughts-on-the-upcoming-jt-express-ipo\/\" target=\"_blank\" rel=\"noopener\">blog post<\/a>.<\/p>\n<p>J&amp;T Express acknowledged in its filing that &#8220;there remain significant uncertainties&#8221; on how the new rules would impact different e-commerce and social media platforms in Indonesia, &#8220;some of which are our customers.&#8221;<\/p>\n<\/div>\n<div class=\"group\">\n<p>But the company said it will not be adversely impacted as the revenue from social e-commerce platforms in Indonesia &#8220;remained immaterial&#8221; to the business.<\/p>\n<p>In 2022 and the first six months of this year, revenue from social e-commerce platforms in Indonesia contributed only 4% and 6% to the company&#8217;s revenue respectively, said J&amp;T.<\/p>\n<p>&#8220;We believe that although [the new e-commerce regulation] may have an impact on our customer composition in Indonesia in the near term, this new regulation will not have a material adverse effect on our business operations and financial performance in the long term.&#8221;<\/p>\n<\/div>\n<\/div>\n\n","protected":false},"excerpt":{"rendered":"<p>Courier handing over package asking female customer to do electronic signature, delivering, receiving, efficiency 10&#8217;000 Hours | Digitalvision | Getty Images Shares of Indonesia&#8217;s J&amp;T Express fell 1.33% when it went public on Friday. The logistics service provider traded at 11.84 Hong Kong dollars ($1.51) on Friday morning, after opening at HK$12. The HK$3.92 billion [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":6935,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"spay_email":""},"categories":[46],"tags":[1699,862,1036,199,935,5461,616,888,10493,10492,10499,10371,300,10495,10500,10498,10491,10494,9291,571,301,304,3612,10497,10490,10496],"jetpack_featured_media_url":"https:\/\/image.cnbcfm.com\/api\/v1\/image\/107324180-1698386148891-gettyimages-1153679356-2019_03_26_family_vlogging_89477.jpeg?v=1698387246&w=1920&h=1080","_links":{"self":[{"href":"https:\/\/demo5.dedicatedhost247.com\/zexo\/wp-json\/wp\/v2\/posts\/6934"}],"collection":[{"href":"https:\/\/demo5.dedicatedhost247.com\/zexo\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/demo5.dedicatedhost247.com\/zexo\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/demo5.dedicatedhost247.com\/zexo\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/demo5.dedicatedhost247.com\/zexo\/wp-json\/wp\/v2\/comments?post=6934"}],"version-history":[{"count":0,"href":"https:\/\/demo5.dedicatedhost247.com\/zexo\/wp-json\/wp\/v2\/posts\/6934\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/demo5.dedicatedhost247.com\/zexo\/wp-json\/wp\/v2\/media\/6935"}],"wp:attachment":[{"href":"https:\/\/demo5.dedicatedhost247.com\/zexo\/wp-json\/wp\/v2\/media?parent=6934"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/demo5.dedicatedhost247.com\/zexo\/wp-json\/wp\/v2\/categories?post=6934"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/demo5.dedicatedhost247.com\/zexo\/wp-json\/wp\/v2\/tags?post=6934"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}