Shanghai Yunda Express Logistics Service Co., Ltd., a leading private Chinese express delivery service provider, is said to have begun making preparations for an IPO.
People in the know disclosed in an interview on August 28 that Yunda Express had begun making preparations for an IPO, becoming the second private Chinese express delivery service provider after Shanghai YTO Express (Logistics) Co., Ltd. to prepare for a listing. A deputy director with its accounting center had been promoted to investment director of it and currently, it was busy with finance docking and related information summarization.
Top executive of the Shanghai-based firm declined to make a comment on the report, but an insider with it revealed that it did be busy with an internal adjustment. As one of the first batch of private Chinese express delivery firms that financed, it introduced institutions including Fosun in 2011. And in line with top executives of many express delivery service providers, an express deliver service firm will have no other choice but to debut on the stock market once it receives investment from venture capital firms.
The Chinese express delivery industry grows fast driven by a boom in the domestic ecommerce market and this directly causes players in the industry to be quite luring to investors. However, express delivery firms there see business volume rise but gross margin still maintain at a relatively low level. Thus almost all of them are in urgent need of financing and debuting on the stock market. And up to 10 of them have received investment from private equity or venture capital firms since the start of this year. For instance, SF Express (Group) Co., Ltd., a Guangzhou-based express deliver service provider, financed about CNY 10 billion not long ago.
Express Mail Service (EMS), a wholly-owned subsidiary of China Postal Group Co., Ltd., unveiled prospectus for an IPO in May 2012 and according to the prospectus, it plans to raise about CNY 9.98 billion through issuing not more than four billion new shares. In line with some industry observers, it will become a trend for private Chinese express delivery firms to debut on the stock market after the IPO of EMS. However, it seems that only SF Express has the ability currently. And compared to it, other private express delivery firms in the market were poor in terms of not only performance but also market development environment and commercial mode. And the best time for them to launch an IPO should be two to three years later.
