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Millet officially submitted IPO application documents will become the world's largest IPO since 2014

via:博客园     time:2018/5/3 12:59:31     readed:368

Key points

  1. Xiaomi submits IPO application document at HKEx, which is expected to become HKEx
  2. Millet plans to use IPO to raise funds 30% for product research and development, and 30% for global expansion.
  3. From 2015 to 2017, the income of Xiaomi was 66 billion 811 million yuan, 684.34. billion yuan and 114 billion 625 million yuan respectively.
  4. Millet company founder, chairman and Lei Jun CEO shares 31.41%, co founder and President Lin Bin holds 13.33%.

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May 3 news, learned from the Hong Kong Stock Exchange website, Xiaomi has officially submitted IPO application documents. Xiaomi is expected to become Hong Kong Stock Exchange

Millet plans to raise IPO 30% to develop and develop core products such as smartphones and televisions; 30% to expand investment and strengthen consumer goods and mobile Internet industry chains; 30% for global expansion; 10% for general operating purposes.

Lei Jun, chairman and CEO Lei Jun, promised all existing and potential users in the open letter of the prospectus.

Xiaomi's financial data in recent three years reflect the rapid growth of business. The prospectus revealed that millet from 2015 to 2017 was 66 billion 811 million yuan, 684.34. billion yuan and 114 billion 625 million yuan, up 67.5% in 2017, 1 billion 373 million yuan, 3 billion 785 million yuan and 12 billion 215 million yuan, and 222.7% in 2017.

Most of its revenue comes from smartphone sales. In the year 2015, 2016 and December 31, 2017, the proportion of smartphone sales accounted for 80.4%, 71.3% and 70.3% respectively.

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The revenue of millet smartphone business increased from 48 billion 800 million yuan in 2016 to 62.5% yuan in 2017 to 80 billion 600 million yuan in 2017. In 2017, sales of millet smartphones were 91 million 400 thousand, while in 2016 it was 55 million 400 thousand. In 2017, the average selling price of smart phones was 881.3 yuan per unit and 879.9 yuan in 2016.

It is worth noting that the growth rate of millet in overseas markets is very strong. Prospectus shows that in 2015, 2016 and 2017, the overseas market revenue of millet was 4 billion 50 million yuan, 9 billion 150 million yuan, and 32 billion 80 million yuan respectively. In 2017, overseas market revenue surged by 250% over the same period, which fully verified the universality of the millet model in the global market.

In 2017, millet lost 43 billion 900 million yuan, 491 million 600 thousand yuan in 2016, and 7 billion 600 million yuan in 2015.

As of December 31, 2017, the net liability of millet was 127 billion 200 million yuan, with a total loss of 129 billion yuan.

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In the prospectus submitted by the Hong Kong stock exchange, millet disclosed the pre market shareholding ratio. Among them, the founder, chairman of the millet company and CEO Lei Jun held 31.41%, and the co - founder and President Lin Bin held 13.33%, and the co - founder and brand strategy officer, Li Wan, held 3.24%. If it is included in the option pool of the total share capital ESOP ESOP, Lei Jun's shareholding ratio is 28%.

Through dual ownership structure, Lei Jun's voting power exceeds 50%, which is the controlling shareholder of Xiaomi group.

The co sponsors of IPO include CITIC Lyons, Goldman Sachs and Morgan Stanley.


Memorabilia of millet:

In 2010, millet was set up

In 2012, the annual income of millet exceeded $1 billion

In 2014, according to IDC data, millet became the number one smartphone company in mainland China.

In 2014, the annual sales of millet exceeded $10 billion

In 2015, the MIUI system has more than 100 million monthly live users

In 2017, millet became the largest consumer class IoT platform in the world.

In the fourth quarter of 2017, according to IDC statistics, millet became the number one smartphone company in India.

In 2017, according to ERI data, in 2017, compared to 100 billion yuan and profit - making listed companies in 2017, millet ranked first in the Internet Co and ranked second in all companies.


The following is a summary of the millet prospectus:

overview

Xiaomi is a Internet Co with mobile phones, intelligent hardware and IoT platform as its core.

Our mission

We ' ve always insisted on doing

Under Lei Jun's leadership, millet was founded by a group of highly accomplished engineers and designers in 2010. They believe that high quality and well-designed technology products and services should be easily enjoyed by the whole world. To this end, we are always pursuing innovation, quality, design, user experience and efficiency. We are committed to providing the best technology products and services at a high price.

Our commitment: in this regard, we have to promise all the existing and potential users, starting from 2018, the annual integration of millet.

The overall net interest rate of hardware business, including smart phones, IoT and consumer products, will not exceed 5%. If there is any excess, we will give feedback to users.

Our vision

Making friends with users is the coolest company in the minds of users.

Our core value

Our values are

Our values enable us to work hard, be optimistic and stick to our mission and vision. We love our career and pursue our craftsmanship in all products. We strive for perfection in all details, even though these details may not be immediately noticed by others. Sincerity has prompted us to put our users at the center of all work, to listen to the needs of the users, and to promote our efficiency in the business model to continue to provide value to the users.

Our rice flour

We have a large and highly active population of global users. As of March 2018, Mii has about 1.9 billion monthly active users. In addition, we have a group of unique global users called

Since we launched the MIUI forum in August 2010 to March 31, 2018, our users have posted about 250 million posts on it.

Our milestone

Since we were founded in 2010, our unique mission

2012: annual revenue exceeded 1 billion US dollars (2 years after implementation).

2014: becoming the number one smartphone company in the Chinese mainland market (according to IDC statistics, 3 years after the launch of our first smartphone)

2014: annual sales exceeded 10 billion US dollars (4 years later), according to AI consulting.

2015: the MIUI system is more than 100 million monthly users

2017: become the world's largest consumer level IoT platform to connect statistics on devices (excluding smart phones and laptops), according to AI consulting.

2017: Smart phone company ranked No. 1 in Indian market shipments in the fourth quarter of 2017 (according to IDC statistics, it will be realized after three and a half years of entering the Indian market)

2017: according to ERI, in 2017, compared with the global revenue of more than 100 billion yuan and profitable listed companies, according to the income growth rate, millet ranked first in the Internet Co and ranked second in all companies.

Our business model

Our company is based on innovation and efficiency. As a company founded by engineers and designers, we advocate the bold and innovative Internet culture and continue to explore cutting-edge technology. The spirit of innovation thrive in millet and permeates every corner and guides us in everything we do. At the same time, we unremittingly pursue the continuous improvement of efficiency. We are committed to reducing operational costs and giving feedback to our users at the same time.

Our unique and powerful

(1) innovative, high-quality, well-designed hardware that focuses on excellent user experience.

(2) efficient new retail sales that enable us to sell our products at a good price.

(3) rich Internet services.

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Hardware

We provide a series of hardware products which are developed independently or jointly with ecological chain enterprises. All products that we develop jointly or independently with eco chain enterprises focus on innovation, quality, design and user experience. We are committed to positioning our products at expanding user acceptance levels to ensure wide acceptance and high retention levels. In terms of core products, we focus on the design and development of a series of advanced hardware products, including smart phones, laptops, smart TV, artificial intelligence speakers and intelligent routers.

We are expanding to other products at the same time. By March 31, 2018, we have established an ecosystem of more than 210 companies through investment and management, of which more than 90 companies focus on developing only hardware and consumer products. As of March 31, 2018, we have connected more than 100 million devices (excluding smart phones and laptops). We have also developed a series of consumer products to further enhance brand awareness and to channel user traffic to our retail channels.

New retail

The efficient and full channel new retail distribution platform is the core component of our growth strategy, enabling us to expand user coverage and enhance the user experience while operating efficiently. Since its establishment, we have been focusing on online direct selling of products to achieve maximum efficiency and establish direct digital interaction with users. According to IDC statistics, in the fourth quarter of 2017, we ranked the first in terms of online smart phone shipments in mainland China and India. Since 2015, we have significantly expanded the offline retail sales network through our own private millet shop to expand our coverage and provide a richer user experience, while implementing the online same price for the same products: keeping the operating efficiency similar to the online channel. Our efficient full channel sales strategy enables us to offer products to the most extensive user groups at a good price.

Internet Services

We provide Internet services to enable our users to have a complete mobile Internet experience. In March 2018, our Android based own operating system, MIU, had active users for about 190 million months. MIUI Android ecosystem is fully integrated, including all mobile applications on Android ecosystem. It forms an open platform that allows us to provide a wide range of Internet services, including content, entertainment, financial services and effectiveness tools. The interconnectivity of our devices and the seamless integration of hardware and Internet services enable us to provide users with better user experience. In addition, we have excellent track record in developing explosive applications. As of March 31, 2018, we have developed more than 10 million applications for 38 months and more than 50 million live users for 18 months, including our millet application stores, millet browsers, millet music and millet video. In March 2018, the average time our users used our smartphone every day was about 4.5 hours. Compared with other high cost Internet platforms, the process we sell through hardware is profitable.

Network effect

Our unique and powerful Triathlon business model consists of three closely linked and mutually supportive pillars. We strive to provide high quality, high performance, well designed and well priced explosive products. These products can bring more traffic to our retail channels. We deliver our products to users at a high price through efficient new retail channels, such as electronic business platform and millet house. Through our Internet service, we interact closely with users who use our platform, thereby increasing user stickiness and bringing new cash opportunities.

Cloud, large data, and artificial intelligence (AI)

We believe that a large number of unique consumer and behavioral data generated by our platform have brought us great advantages in the field of large data and artificial intelligence, so we can take advantage of the understanding of the user's personalized needs and preferences, provide customized recommendations and further enhance our ability to cash in. Through the millet account service launched in 2012, our users can use the cloud services we provide, online shopping, the enjoyment of content, and many other services. As of March 31, 2018, we have accumulated over 230PB of proprietary data in cloud services through the user's prior permission. These data are stored in strict privacy standards and data security requirements. Please refer to the "one data privacy and protection" section. Since 2016, our MIUI and millet business city has been fully assessed and certified by TrustArc, a privacy compliance and Risk Management Inc, on privacy policies and controls. Our deep learning and AI technology capabilities as well as the active user participation of our platform enable us to continuously improve products and services. For example, face recognition technology is the core technology of our calculator vision. When the user data is increasing, our algorithm can further improve the accuracy and efficiency, and form a positive feedback loop with user activity. The whole process is based on the collected user behavior data, and does not involve data privacy of users. In the future, we will continue to introduce new technology products and services that support AI, such as the little love speakers we launched in July 2017.

Our global opportunities

Since its inception in 2010, we have continuously expanded the user community in mainland China through leading business models. We have also successfully developed an international strategy for new markets. As of March 31, 2018, we have entered the market of 74 countries and regions.

We have a successful foothold in the main international market. For example, according to IDC statistics, as of the 4 quarter of 2017, our smartphone shipments in India ranked first, and we ranked the top 5 in 15 markets.

As we expand our business worldwide, we can increase profitability while increasing revenue. In the business record period, our income increased from 66 billion 800 million yuan in 2015 to 114 billion 600 million yuan in 2017. In 2017, the profit of RMB 5 billion 400 million yuan was adjusted by non international financial reporting standards. In 2015, there was a loss of RMB 300 million yuan by adjusting non international financial reporting standards.

Our industry and competition pattern

We operate the global smart phone, consumer class Internet of things, Internet services and new retail industry. These industries are fierce competition: they are very high in entry level.

Smartphone users worldwide are huge and growing. According to IDC statistics, the total number of smart phone devices increased from 2.871.0 million in 2015 to 3 million 665 thousand and 700 in 2017, with a compound annual growth rate of 13%. It is expected to reach 4 billion 798 million 500 thousand in 2022 and 5.5% in 2017 to 2022. With the increase in smartphone usage in emerging markets, global smartphone usage is expected to rise. High cost performance equipment and excellent user experience will boost shipments and smart phone usage. In addition, because of the need for competitive smart phones to develop and design prototypes, the early costs are high, so the entrance to the smartphone market is high. Leading smart phone companies have a strong position, wide market brand recognition, stable supply chain and mature distribution channels, and new market participants are unlikely to compete with them and get a huge market share. Market participants need to reach a large scale to achieve operational leverage and establish a long-term and sustainable business model.

As the technology progress of sensors and equipment processors can make the Internet connection as the standard function of all kinds of consumer products, it is expected that the global consumer IoT market will be multiplied. According to AI consulting, the number of consumer loT terminals increased from 3 billion in 2015 to 4 billion 900 million in 2017, with a compound annual growth rate of 277%. It will be 15 billion 300 million in 2022 and 25.4% in 2017 to 2022. IoT's large and rapidly growing foundation can collect a large amount of real-time data and develop various consumer applications. The successful consumer IoT strategy not only requires the company to provide quality and well designed products, but also to provide a variety of products that can be seamlessly connected to a single application, such as app, to meet the daily needs of the user.

Internet is an indispensable tool for individuals to interact with the world. According to ARI, the size of the global Internet service market increased from $10106 billion in 2015 to $15404 in 2017, with an annual growth rate of 23.5%. As smartphones become the main media for customers to access the Internet, the penetration of the mobile Internet is rising, and the global Internet service market is expected to reach $26009 billion in 2022, with a composite annual growth rate of 11%. The competition in the Internet service market is fierce, and it is occupied by many competitive Internet service participants. Companies that can obtain and retain users through the sale of hardware devices can enhance their competitiveness by getting customers at lower costs, enhancing mutual assistance with users, and improving the ability to collect data.

New retail can be understood as relying on Internet technology to achieve seamless integration of online and offline retail channels and improve efficiency. The online and offline retail channels are highly integrated to drive customer traffic and improve overall sales efficiency. New retail outlets are also directly distributed to consumers through private online offline channels, thereby increasing cost efficiency and reducing additional distribution needs.

competitive edge

We believe that the following competitive advantages are crucial to our success and make us stand out from our competitors.

- the founder team;

- the enthusiastic user group;

- Triathlon business model;

- innovation and design;

- efficiency;

- ecological chain;

- cloud, large data and artificial intelligence; and

- international success.

Our strategy

To achieve our mission and further consolidate our leadership, we are going to implement the following strategies:

- great emphasis on innovation, quality and user experience;

- keeping the extreme and high efficiency;

- enlarging the category of the exploded products;

- deepening Internet service;

- investment and expansion of the ecological chain; and

- deepening international expansion.

risk factor

Some of the main risks we face are:

- our ability to compete effectively in the global market of products and services (competitive and technological advances).

- we are effective in managing growth or implementing strategies;

- we maintain the credibility and brand image of our products and services;

- we successfully manage frequent product launch and transition capabilities.

- we expand and maintain the capabilities of user groups, as well as user participation.

- we have incurred losses and net liabilities in the past, and may continue to generate losses in the future and may not be able to declare or distribute dividends.

- our ability to maintain growth trends;

- our operation history is limited, so it is difficult to assess future prospects.

- smartphone sales account for a larger portion of our revenue; and

- we retain our existing advertisers or attract new advertisers, maintain and increase our advertising budget share and timely collection of accounts receivable.

Contract arrangement

The following chart shows the economic interests of the combined entities under the contractual arrangements:

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(the content of the prospectus is continuing to be updated)

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