KrASIA weekly: ZTE in state of shock after US ban; DJI ditching traditional fundraising

Good Sunday afternoon. This is Xiaochun.

After the US banned American companies from selling components to ZTE, the Chinese telecom equipment manufacturer said last week that the company is in a “state of shock”.

Previously in 2017, ZTE pledged guilty for shipping US equipment to Iran and North Korea and agreed to pay $1.19 billion in penalties. But the US government said ZTE made false statements regarding reprimanding employees involved.

The US ban triggered a discussion in China about lowering dependence on US parts suppliers. Under the circumstances, Alibaba announced on Friday it has fully acquired C-SKY, a Chinese company that claims to be the country’s only chip maker that mass-produces integrated CPU IP cores.

While ZTE is struggling to survive, DJI, the world’s largest consumer drone maker, is boldly ditching the traditional way of fundraising. Instead of employing a financial advisor, the company is selecting investors through a bidding process for its $1 billion round at a $15 billion valuation.

Over 100 investors have propelled the total sum for the round to over 30 times oversubscribed. Investors have high expectations for the company’s future growth, in part because of its excellent profit-making performance. In the past three consecutive years, the company’s net profit surged 200% from RMB 1.42 billion (around US$225.6 million) in 2015 to RMB 4.3 billion (around US$683.1 million) in 2017, according to local media All Weather TMT.

With the fresh funds, DJI is likely to expand to the drone market that targets enterprise clients, making its future even more brighter.

Here are some stories and ideas from last week that you shouldn’t miss.

Good Sunday afternoon. This is Xiaochun.

Here are some stories and ideas from last week that you shouldn’t miss.

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