China’s Pintec Technology targets $44.3m IPO

The jittery public market is not stopping Pintec from its ambitions to become a listed entity

Source: Unsplash.

Chinese financial technology platform Pintec Technology announced today that it will offer 3,725,000 American depositary shares (ADS) at US$11.88 apiece as it looks to raise US$44.3 million – lower than its initial US$ 70 million target – under the ticker symbol “PT” on Nasdaq.

This does not account for the option to purchase additional shares, where the underwriters – Goldman Sachs, Deutsche Bank, Citigroup Global Markets and ICBC International Securities Limited – can choose to buy up to 558,750 more ADS.

Pintec Technology connects businesses and financial institutions to offer online lending and other financial products. By March 31st 2018, the company claimed that it was already serving 21 million registered users for products like point-of-sale financing, personal, and business loans.

In July, KrASIA reported that Pintec filed its prospectus with the US Securities and Exchange Commission (SEC), and this push to transit into a public company is occurring at a time when the markets are volatile and more regulatory scrutiny makes business expansions harder.

While Seeking Alpha reports that Pintec has seen a 936% year-on-year growth in its sales revenue and the mid-range ask price is quite reasonable, a peer comparison yields a different story. A SmartKarma research report revealed that the month-on-month decline in Pintec’s loan facilitation volume is worse than other players like Weidai Ltd and X Financial.

Nevertheless, this move set the just 5-year-old firm on a pathway to becoming a public company, which highlights how quickly technology has disrupted traditional financial services in China. Its growth is a testament to how technology can be embedded in a wide range of services like point-of-sale financing, personal installment loans, business installment loans to insurance, essentially making financial services more efficient, effective and available to more people.