Lufax plans IPO in Hong Kong

Online peer-to-peer lender Lufax's initial public offering in Hong Kong could take place before the end of next year.
Online peer-to-peer lender Lufax's initial public offering in Hong Kong could take place before the end of next year.PHOTO: LUFAX.COM

HONG KONG • Chinese online peer-to-peer (P2P) lender Lufax is gearing up for an initial public offering (IPO) in Hong Kong, potentially before the end of next year.

The company's chief financial officer James Zheng said on Wednesday that while there was no timetable for the IPO yet, the firm is going to start planning for a public offering, The Wall Street Journal (WSJ) reported.

The IPO is a major test of investor appetite for China's burgeoning fintech industry, WSJ said in a report on Wednesday.

Lufax - valued at US$18.5 billion (S$25 billion) in its latest funding round - was earlier considering a listing on a proposed new technology-focused board in Shanghai, but a plan to set up the so-called Strategic Emerging Industries Board was not included in a five-year plan issued by China's Cabinet in March.

"The new board in Shanghai is not happening" and the company's offshore ownership structure means that "Hong Kong will make sense", Mr Zheng said on the sidelines of a Credit Suisse Group technology conference in Hong Kong.

Mr Zheng said they are backed by insurer Ping An Insurance (Group) of China.

Lufax is not planning to have another funding round before the IPO, he added.

Stock exchanges are vying to attract IPOs and the financial-services affiliates of Chinese e-commerce companies such as Alibaba Group Holding and JD.com.

Ant Financial Services Group, valued at US$60 billion after an April funding round, has said it plans to go public, but does not have a timetable for the listing.

The news comes as China aims to tame its P2P lending sector after a series of scandals and multi-billion-dollar failures.

But many larger P2P companies, including Lufax, Yirendai, PPDAI and Dianrong.com, say they already comply with many of the new requirements, so they could benefit from the restrictions, Reuters said.

A version of this article appeared in the print edition of The Straits Times on August 26, 2016, with the headline 'Lufax plans IPO in Hong Kong'. Print Edition | Subscribe