IPOs and Catalysts/Events, Global Equity Research Ltd

Arun George

IPOs and Catalysts/Events

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<p><a href="https://www.smartkarma.com/entities/linklogis" target="_blank" data-smartkarma-citation="entities:31126:1" rel="noopener">Linklogis (LINK HK)</a> is a leading technology solution provider for supply chain finance in China. Its solutions optimise the payment cycle of supply chain transactions and digitalize the entire workflow of supply chain finance. Linklogis was the leading technology solution providers in China with a 20.5% market share of supply chain finance transactions processed in 9M20, according to CIC. Linklogis 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>, CITIC Capital, GIC and <a href="https://www.smartkarma.com/entities/standard-chartered-plc" target="_blank" data-smartkarma-citation="entities:193:1" rel="noopener">Standard Chartered (STAN LN)</a>. Linklogis has filed for a Hong Kong IPO to raise as much as $500 million, according to press reports.</p><p>Linklogis is a play on China’s supply chain finance market. SMEs in China had an average of 92 days of accounts receivable outstanding in 2019, higher than 51 days on average in the US. It could also take up to 6 to 12 months for SMEs to receive final payments. The Chinese government has introduced a series of supportive policies to direct funding towards small businesses, including imposing SME lending growth targets for banks. Supply chain finance has proven to be a useful way to bridge the financing gap of SMEs, as it allows SMEs to get quick access to payment and funding at low costs. In 9M20, Linklogis’ customers helped their SME suppliers obtain low-cost financing at an average financing cost of 5.4%, significantly lower than the cost of financing extended to SMEs relying on their own creditworthiness that ranges from 10% to 20%, according to CIC.</p><div class="content-highlight"><p>Linklogis is an attractive play on these market dynamics by combining an attractive monetisation model, high customer retention rate (strong revenue visibility) and good operating leverage.</p></div>

Linklogis (LINK HK) is a leading technology solution provider for supply chain finance in China. Its solutions optimise the payment cycle of supply chain transactions and digitalize the entire workflow of supply chain finance. Linklogis was the leading technology solution providers in China with a 20.5% market share of supply chain finance transactions processed in 9M20, according to CIC. Linklogis is backed by Tencent Holdings (700 HK), CITIC Capital, GIC and Standard Chartered (STAN LN). Linklogis has filed for a Hong Kong IPO to raise as much as $500 million, according to press reports.Linklogis is a play on China’s supply chain finance market. SMEs in China had an average of 92 days of accounts receivable outstanding in 2019, higher than 51 days on average in the US. It could also take up to 6 to 12 months for SMEs to receive final payments. The Chinese government has introduced a series of supportive policies to direct funding towards small businesses, including imposing SME lending growth targets for banks. Supply chain finance has proven to be a useful way to bridge the financing gap of SMEs, as it allows SMEs to get quick access to payment and funding at low costs. In 9M20, Linklogis’ customers helped their SME suppliers obtain low-cost financing at an average financing cost of 5.4%, significantly lower than the cost of financing extended to SMEs relying on their own creditworthiness that ranges from 10% to 20%, according to CIC.Linklogis is an attractive play on these market dynamics by combining an attractive monetisation model, high customer retention rate (strong revenue visibility) and good operating leverage.

China

Linklogis is a technology solution provider for supply chain finance, offering digital credit services and tech-based solutions for digital cross-border trades and other fintech services. The company leverages AI, Blockchain, Cloud computing, and Big data to optimize payment cycles, digitalize workflows, and enhance transparency in the supply chain finance ecosystem. Linklogis was founded in February 2016 and is headquartered in Shenzhen, China.

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Linklogis (9959 HK)

Linklogis IPO Initiation: ISupply

Linklogis is an attractive play on China’s supply chain finance market by combining an attractive monetisation model, high customer retention rate...

Arun George

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