Sungy Mobile stock closes up 19% after $78.5m US IPO
Sungy Mobile, a Chinese app developer backed by IDG Capital Partners, JAFCO, WI Harper and China Broadband Capital (CBC), saw its stock jump 19% on its first day of trading on NASDAQ to close at $13.35.
The company sold 7 million American Depository Shares (ADS) at $11.22 apiece - towards the high end of indicative range of $9.50-11.50 - to raise $78.54 million in its IPO. It was initially targeting $80 million.
Sungy Mobile, which develops apps, widgets and functions for Android smart phones, claims to be one of the top three publishers globally on Google Play.
According to a regulatory filing, IDG owned 28.7% of Sungy, while JAFCO, WI Harper and CBC held 9.6%, 9.7% and 14.6%, respectively. AVCJ Research data indicate that IDG first invested in the company in 2005, with JAFCO and WI Harper entering four years later. It isn't clear when CBC invested.
Due to the dilution effect, IDG's equity interest has been reduced to 20.8% post-IPO, while JAFCO, WI Harper and CBC hold 7.0%, 7.1% and 10.6%, respectively.
Sungy's platform product, GO Launcher Ex, launched in 2010 and had attracted approximately 239 million users from more than 200 countries and regions as of September. The apps that run off this platform are designed to improve smart phone functionality and performance and aid personalization.
The company started out in 2003 creating products and services for WAP and Symbian operating systems but switched to Android as it grew in popularity. In addition to the GO platform and products, Sungy operates a mobile internet portal and mobile reading services.
Revenues, generated from advertising, paid apps, in-app purchases and sales of literary content, reached RMB185.2 million ($30.2 million) in 2012, up 91.7% year-on-year. The company also turned profitable in 2012, with net income coming in at RMB15.2 million. It achieved revenues of RMB139.3 million in the first half of 2013, with net income of RMB5.5 million.
Sungy Mobile was the fifth VC-backed Chinese companies to go public in the US this year, following 58.com, Qunar, LightInTheBox and Montage Technology Group. This compares to just two offerings last year. Online sports lottery operator 500.com also set its IPO terms on Friday. It plans to sell 5.8 million ADSs at $13 apiece for a total of $75.2 million.
Credit Suisse and J.P. Morgan acted as the joint bookrunners on the Sungy deal.
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