Hong Kong-based tycoon Li Ka-Shing’s mobile lending start-up, WeLab, has filed for an initial public offering on the Hong Kong Stock Exchange, according to its IPO prospectus.
China Money Network previously reported that the company was planning for a US$500 million listing.
Founded in 2013, WeLab is a Hong Kong-based mobile lending company operating across the Greater China region. It offers personal instalment loans with tailored features including pricing, tenure and amount.
Through WeLend, its direct-to-consumer lending platform, the company receives interest and service fees from its borrowers. In 2017, the average loan amount was HK$87,194 (US$11,251), the average tenure was three to four years and the average effective interest rate was 24.7%.
Its end-to-end loan facilitation solution platform WoLaiDai serves both retail borrowers and funding partners in China. The majority of its funding partners are P2P lending platform investors and licensed institutions. WeLend also provides B2B services to allow business customers to launch their own mobile lending platforms with WeLend’s technology solutions.
Its total revenue has increased from US$2.2 million in 2015 to US$30.3 million in 2016 and US$155.1 million in 2017, representing a compound annual growth rate of 742.2%. It recorded a net loss of US$13.5 million and US$24.8 million in 2015 and 2016 respectively, and a net profit of US$17.7 million in 2017. In 2017, 42.9% of its revenue came from loan facilitation service, 37.6% from credit service income and 10.2% from interest income.
The delinquency ratio of outstanding loans (loans past due period of 13 to 120 days) on WoLaiDai platform grew from 1.9% in 2015 to 3.9% in 2016 and 6.1% in 2017. while that on WeLend declined, to 1.3% in 2017 from 2.3% in 2016.
In 2017, it raised a US$220 million series B+ round from Alibaba Hong Kong Entrepreneurs Fund, International Finance Corp, Credit Suisse and others.
Its other investors include DST Global’s founder Yuri Milner, San Francisco-based investment advisor Iconiq Capital, Hong Kong-listed Chinese media conglomerate TOM Group and Sequoia Capital, and Malaysia’s state fund Khazanah Nasional.