China's Lufax hits $39.4b valuation with Series C round

Ping An revealed the valuation in its latest annual report. Xinying Chen, the company’s co-CEO, later confirmed that the $1.33 billion round featured the likes of Qatar Investment Authority (QIA), All-Stars Investment, and Primavera Capital Group. Earlier reports claimed that LionRock Capital, Goldman Sachs, J.P. Morgan, UBS, Macquarie, SBI Holdings, and Hermitage Capital were also among the investors.

Created in 2011, Lufax is formally known as Shanghai Lujiazui International Financial Asset Exchange. It was initially positioned as a peer-to-peer (P2P) lending platform and an exchange-of-exchanges through which institutions and retail customers could distribute and trade non-standard assets.

The company now breaks down its business into three areas. The retail – or P2P – lending platform serves more than 10.3 million customers, chiefly micro, small and medium-sized enterprises and individuals. The loan application process is entirely online, utilizing facial and voiceprint recognition technology. As of December 2018, the balance of loans under management was RMB375 billion ($59 billion), with RMB396.9 billion in new loans facilitated over the preceding 12 months.

Second, the wealth management arm offers more than 5,000 financial products to over 40.3 million registered users. Lufax primarily serves as the broker between customers and third-party providers. A total of RMB1.48 trillion in wealth management products were processed in 2018 and year-end assets under management stood at RMB369.4 billion. The final business line involves the provision of customized fiscal management solutions to provincial and municipal governments.

Lufax raised a RMB3 billion ($483 million) funding round in 2015 – at a valuation of approximately RMB60 billion – led by BlackPine, a Hong Kong-based investment firm, and the PE division of China International Capital Corporation (CICC).

In early 2016, the company said it had raised $1.22 billion at a valuation of $18.5 billion. The round comprised $924 million from new investors and $292 million from existing backers who exercised an option to participate. Bank of China Group Investment, Guotai Junan Securities, and an offshore unit of China Minsheng Bank were among the new investors.

Ping An also referenced funding rounds for two other subsidiaries that closed in early 2018. It revealed that the $1.15 billion round for Ping An Healthcare Management from SoftBank Vision Fund, IDG Capital, and SBI Group was at a valuation of $8.8 billion, while OneConnect Financial Technology received $650 million from the same two investors at a valuation of $7.5 billion.

Ping An Healthcare Management – known as Ping An HealthKonnect – was launched in 2017 and aims to become the country's largest open platform for managed care services, focused on social health insurance and private insurance. The business covers 200 cities nationwide.

Established in late 2015, OneConnect provides financial technology solutions to over 3,200 banks, insurers, and non-bank financial institutions. Its risk management and smart certification products were used 1.54 million times and 1.22 million times in 2018 to support transactions worth RMB20.3 trillion.

The two funding rounds were announced alongside a $400 million pre-IPO investment by Vision Fund in Ping An Healthcare & Technology, operator of Ping An Good Doctor, an online platform that connects consumers and patients with healthcare service providers. The valuation was $5.4 billion. The company went public in May 2018 and now has a market capitalization of around $6.2 billion.

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• Topics
• Greater China
• Financials
• Expansion
• Technology
• China
• Growth capital
• Primavera
• QIA
• All-Star Investments