New shares announcement | Qiniu Intelligent (02567) starts to IPO today. Introducing Heshun as cornerstone investor to subscribe for 63.9 million shares in the offering.

Qiniu Intelligence (02567) will be listed from September 30, 2024 to October 10, 2024, with plans to globally issue 160 million shares. 10% of the shares will be publicly offered in Hong Kong, while 90% will be offered internationally, with an offering price range of HK$ 2.74 to HK$ 2.86 per share, in lots of 1000 shares each. Trading of the shares is expected to begin on October 16, 2024 (Wednesday) at 9:00 am on the Stock Exchange of Hong Kong. The company has entered into a cornerstone investment agreement with Ho Shun Limited Partnership (Ho Shun or the cornerstone investor). Ho Shun has agreed, under certain conditions, to subscribe at the offering price for or procure the subscription of 63.9 million shares, representing approximately 3.20% of the total issued shares following the completion of the global offering (assuming the exercise of the over-allotment option is not exercised and there is no issuance of shares based on the pre-offering share capital). Assuming the over-allotment option is not exercised and the offering price is HK$ 2.80 per share (the median of the offering price range of HK$ 2.74 to HK$ 2.86 per share), the company expects to receive a net amount of approximately HK$ 375 million from the global offering (after deducting underwriting commissions and expenses related to the global offering). Approximately 38.0% of the net proceeds are expected to be used to penetrate and consolidate the company's market share and develop and expand its customer base in the APaaS business, including: 1) approximately 15.0% of the net proceeds are expected to be used to purchase networks and bandwidth, servers, and storage to support business growth; 2) approximately 9.0% of the net proceeds are expected to be used to enhance sales and marketing functions; 3) approximately 14.0% of the net proceeds are expected to be used to recruit personnel for the development and accumulation of more in-depth scenarios in APaaS. Approximately 20.0% of the net proceeds are expected to be used to expand overseas business over the next 36 to 60 months, including: 1) approximately 8.0% of the net proceeds are expected to be used to enhance the company's overseas IT infrastructure; 2) approximately 12.0% of the net proceeds are expected to be used to establish local teams in regions and countries such as Greater China and Southeast Asia, where the video and audio industry is in the early stages of development and has significant growth potential. Approximately 12.0% of the net proceeds are expected to be used to enhance the company's research and development capabilities and improve its technical infrastructure, including: 1) approximately 8.0% of the net proceeds are expected to be used to develop the company's AIGC capabilities over the next 36 to 60 months; 2) approximately 4.0% of the net proceeds are expected to be used to upgrade and iterate the low-code platform over the next 36 to 60 months. Approximately 20% of the net proceeds are expected to be used for selected mergers, acquisitions, and strategic investments. Approximately 10.0% of the net proceeds are expected to be used for working capital and general corporate purposes. The company provides video and audio cloud services in China, according to iResearch, the company's revenue accounted for 1.5% of the entire video and audio cloud service market in 2023. According to iResearch, based on revenue in 2023, the company is the third largest video and audio PaaS service provider in China, with a market share of 5.8%, and based on revenue from APaaS in 2023, the company is also the second largest video and audio APaaS service provider in China, with a market share of 14.1%. According to iResearch data, the size of China's cloud service market in 2023 will reach RMB 513.7 billion. The China cloud service market can be divided into the video and audio cloud service market and the non-video and audio cloud service market based on the type of content or data managed. The video and audio cloud service market refers to the production, storage, processing, distribution, analysis, auditing, retrieval, and recommendation of unstructured video and audio content, while the non-video and audio cloud service market refers to other cloud services such as government cloud, retail and catering cloud, and industrial cloud. In 2023, the video and audio cloud service market reached RMB 91.5 billion and accounted for 17.8% of the total cloud service market in China, while in 2023, the PaaS market and APaaS market accounted for 25.0% and 2.2% of the entire video and audio cloud service market, respectively. In the past reporting period, the company's revenue for 2021, 2022, and 2023, as well as the three months ended March 31, 2024, were RMB 1.471 billion, RMB 1.147 billion, RMB 1.334 billion, and RMB 342 million, respectively. Adjusted net losses for 2021, 2022, and 2023, as well as the three months ended March 31, 2024, were RMB 106 million, RMB 119 million, RMB 116 million, and RMB 24.2 million, respectively.