NEW YORK, Nov. 5 (Xinhua) -- Q&K International Group, a long-term apartment rental company in China, listed its initial public offering (IPO) on the Nasdaq Global Market on Tuesday under the ticker symbol QK.
The company has priced its IPO of 2.7 million American Depositary Shares (ADSs) at 17 U.S. dollars per ADS for a total offering size of approximately 45.9 million dollars, assuming the underwriters do not exercise their option to purchase additional ADSs, Q&K International Group said in a statement on Tuesday.
Each ADS represents 30 Class A ordinary shares. The underwriters have been granted an option, exercisable within 30 days from the date of the final prospectus, to purchase up to 405,000 additional ADSs at the IPO price.
Shares of Q&K International Group extended solid gains throughout Tuesday and climbed 3.76 percent to settle at 17.64 dollars around market close.
Founded in 2012, the Shanghai-based company booked 130.8 million dollars in net revenue for the nine months ended June 30 this year, up 51.4 percent year-on-year. Yet the realtor also suffered a net loss of 54.4 million dollars for the same period, according to its latest prospectus.
Long-term apartment rental refers to apartment rental with a lease term of one month or longer. Q&K International Group mainly renovates and sub-leases apartments in Chinese cities including Beijing, Shanghai and Hangzhou.
Its target customers include recent college graduates, entry-level white collars and industry workers.
As of June 30, the platform had 96,854 available rental units under management spread across China, approximately 95.8 percent of which were located in the Yangtze mega-city cluster centered around Shanghai, said its prospectus.
"China's long-term apartment rental market is experiencing rapid growth, and we are a fast-growing company, which is the main appeal to U.S. investors," Jin Guangjie, founder and CEO of the group, told Xinhua on Tuesday.
The company has ranked third among major operators in the branded long-term apartment rental market in China, in terms of the number of available rental units by Dec. 31, 2018.
"Going public in the U.S. stock market not only improves our credibility, but also prompts us to strengthen the management of the company," he added.
China's central and local governments also help incentivize the property rental industry by carrying out a set of favorable policies, including reducing income tax, medical insurance and social security payment ratio, the company said in its prospectus.
Market supply and demand of residential properties for rental have remained imbalanced, which is a major driving force for the growth of long-term apartment rental industry, Jin noted.
"The demand for property rental will expand," the entrepreneur said. "As a tech-driven platform, our company plays a role to better allocate market resources and help solve information imbalance."
The market size, as measured by rents paid by tenants, reached 220.2 billion dollars in 2018. This growth is expected to continue and reach around 438 billion dollars in 2024, showed the firm's filing.