Equity Analyst, LightStream Research

Shifara Samsudeen, ACMA, CGMA

Equity Analyst

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

Equity Capital Markets

KE Holdings (also known as Beike) has filed to list its shares on the New York Stock Exchange and aims to raise about US$1bn. Beike is a leading integrated online and offline platform for housing transactions and services in China.The residential real estate market in China has grown significantly over the past few years mainly driven by continuous urbanisation, increasing demand for quality housing and favourable government policy towards providing stable housing for citizens. However, the residential real estate brokerage market is underpenetrated in China which offers significant opportunities for companies such as Beike.Historically, the company’s revenue growth was driven by Lianjia stores, however, with the launch of the company’s Beike platform, which connects property agents and home buyers, the revenues of the company has grown rapidly over the last two years.In this insight, we take a look at the company’s business segments, financials and future outlook. We aim to cover the company’s balance sheet and cashflow analysis in a follow-up insight.

KE Holdings (also known as Beike) has filed to list its shares on the New York Stock Exchange and aims to raise about US$1bn. Beike is a leading integrated online and offline platform for housing transactions and services in China.The residential real estate market in China has grown significantly over the past few years mainly driven by continuous urbanisation, increasing demand for quality housing and favourable government policy towards providing stable housing for citizens. However, the residential real estate brokerage market is underpenetrated in China which offers significant opportunities for companies such as Beike.Historically, the company’s revenue growth was driven by Lianjia stores, however, with the launch of the company’s Beike platform, which connects property agents and home buyers, the revenues of the company has grown rapidly over the last two years.In this insight, we take a look at the company’s business segments, financials and future outlook. We aim to cover the company’s balance sheet and cashflow analysis in a follow-up insight.

KE Holdings IPO (Beike): Dreams Come Home

IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

Uncompromised, Independent, Conflict-Free Research

Global Equity Research Ltd

Global Equity Research was started in 2017 by a group of experienced research professionals. It was founded on a passionate belief in the importance and the need for uncompromised, independent, conflict-free research. We aim to provide differentiated and actionable primary and bottom up fundamental research.

<a href="https://www.smartkarma.com/entities/ke-holdings-inc" target="_blank" data-smartkarma-citation="entities:29213:1" rel="noopener">KE Holdings Inc (BEKE US)</a> is a combination of Lianjia, China's leading real estate brokerage brand, and Beike, China's leading integrated online and offline platform for housing transactions. KE’s GTV (gross transaction value) market share for existing and new home sales and home rentals through brokerage services in China increased from 11.5% in 2018 to 19.2% in 2019, according to CIC. KE is backed by <a href="https://www.smartkarma.com/entities/tencent-holdings-ltd" target="_blank" data-smartkarma-citation="entities:26:1" rel="noopener">Tencent Holdings (700 HK)</a> (12.3% stake), <a href="https://www.smartkarma.com/entities/softbank-group-corp" target="_blank" data-smartkarma-citation="entities:315:1" rel="noopener">Softbank Group (9984 JP)</a>’s Vision Fund (10.2%) and Hillhouse (5.3%). It is seeking to raise $2 billion through an IPO on the New York Stock Exchange, according to press reports.<div class="content-highlight">Instead of holding off the IPO process due to a 1Q20 ravaged by the COVID-19 outbreak, KE pressed ahead as it “believes that our fundamental value, rather than external circumstances, is the key factor of a successful IPO.” Our analysis suggests that if you consider the 1Q20 performance as a one-off (supported by the strong recovery in 2Q20), its financial performance is heading in the right direction with strong revenue growth and rising margins. While the cash generation is weak, it is due to industry-specific circumstances. Overall, we believe that the KE IPO is worth a close look.</div>

KE Holdings Inc (BEKE US) is a combination of Lianjia, China's leading real estate brokerage brand, and Beike, China's leading integrated online and offline platform for housing transactions. KE’s GTV (gross transaction value) market share for existing and new home sales and home rentals through brokerage services in China increased from 11.5% in 2018 to 19.2% in 2019, according to CIC. KE is backed by Tencent Holdings (700 HK) (12.3% stake), Softbank Group (9984 JP)’s Vision Fund (10.2%) and Hillhouse (5.3%). It is seeking to raise $2 billion through an IPO on the New York Stock Exchange, according to press reports.Instead of holding off the IPO process due to a 1Q20 ravaged by the COVID-19 outbreak, KE pressed ahead as it “believes that our fundamental value, rather than external circumstances, is the key factor of a successful IPO.” Our analysis suggests that if you consider the 1Q20 performance as a one-off (supported by the strong recovery in 2Q20), its financial performance is heading in the right direction with strong revenue growth and rising margins. While the cash generation is weak, it is due to industry-specific circumstances. Overall, we believe that the KE IPO is worth a close look.

KE Holdings (Beike) IPO Initiation: Home Truths

China

KE Holdings Inc. operates as an integrated online and offline platform for housing transactions and services. The Company offers existing and new home sales, home rentals, home renovation, real estate financial solutions, and other services. KE Holdings conducts businesses in China.

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KE Holdings (BEKE US)

KE Holdings IPO (Beike): Dreams Come Home

KE Holdings (also known as Beike) has filed to list its shares on the New York Stock Exchange and aims to raise about US$1bn. Beike is a leading...

Shifara Samsudeen, ACMA, CGMA

KE Holdings (Beike) IPO Initiation: Home Truths

KE Holdings Inc (BEKE US) is a combination of Lianjia, China's leading real estate brokerage brand, and Beike, China's leading integrated online...

Arun George

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52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)