GOGOX: Gogox Trucks Ahead with Hong Kong IPO Despite Growing Headwinds

Key takeaways: Gogox has been approved to list in Hong Kong despite operating in the red for years and seeing no potential profits for at least the next two years Company derives lion's share of its revenue from mainland China, but may be losing ground to a new rival operated by DiDi Global By Jony Ho Gogox Holdings Ltd. may be a massively money-losing online logistics platform, but that doesn't mean it's not going places. Despite losing 2.3 billion yuan ($360 million) over the past three years, the Alibaba-backed (NYSE: BABA) operator of a trucking service-for-hire met market capitalization and revenue requirements for a listing in Hong Kong, which normally frowns on IPOs for money-losing companies. Having reached those milestones, Gogox has received the official green light to move ahead with a listing on the city's main board. Its IPO application was approved and uploaded on Sunday to the Hong Kong Stock Exchange website. Gogox was established in 2013 and operates China's second largest online intra-city logistics platform. It plans to raise up to $500 million through the listing, according to financial news publication IFR. The company's prospectus shows that it posted losses attributable to shareholders of 1.07 billion yuan, 184 million yuan and 658 million yuan in 2018, 2019 and 2020, respectively. It lost another 393 million yuan in the first three quarters of last year, and doesn't see itself breaking even in the next two years. So, how can such a sea of red ink convince investors to cough up big bucks for its IPO? The company's journey dates back to July 2013 when three young Hong Kongers, Lam Hoi Yuen, Kwan Chun Man and Tang Kuen Wai, returned from their overseas studies in the U.S. and set up their venture with two friends experienced in computer programming and design. They founded GoGoVan, the predecessor of Gogox, becoming the first smartphone app in Asia that could instantly locate truck drivers to provide delivery services. Its edgy business model breathed new life into the logistics industry and the company secured $370 million in its first three fundraising rounds. In 2016 it broadened its footprint to the ...Full story available on Benzinga.com