Chinese wealth manager Hywin Holdings Ltd. is set to begin trading on the Nasdaq Global Market on Friday in a downsized IPO worth $30 million.
The Shanghai company priced its shares at $10 apiece and sold 3 million American depositary shares – less than it targeted earlier. It is expected to lift off under the ticker “HYW” today in a deal underwritten by Network 1 Financial Securities Inc., Alexander Capital L.P., and Valuable Capital Ltd.
Hywin claims to be the third-largest wealth management service provider in China. Citing China Insights Consultancy in its prospectus, it said it held 7.5% market share in 2019 in terms of transaction value.
In the 12 months through June 2020, Hywin distributed wealth management products in the value of $9.7 billion, up 23% year-over-year. It focuses on real estate products, and private equity and venture capital funds products and has collaborated with some of China’s top property developers including Evergrande and Sunac. In addition to wealth management, Hywin also provides insurance brokerage and asset management services. In the year through June 30, Hywin counted 36,397 active clients.
For the same period, Hywin reported revenues of $181.5 million, at an increase of 12% year-over-year. Net income increased 71% to $15 million in the 12-month period, according to the prospectus. The company noted that its performance has been affected by the “increasingly stringent regulatory environment in China.”
Hywin said it plans to use the capital from its IPO to expand its asset management and wealth management business, grow its network in China and overseas, invest in IT and general corporate purposes.
Hywin is expected to being trading today and close its offering on March 30.