Core Viewpoint - Xunzhong Communication is facing challenges due to a contractual dispute with Beijing Yacon and Beijing Yunxi, leading to the judicial freezing of two bank accounts. The upcoming unlocking of 9.5565 million shares held by cornerstone investors on January 9 may pressure the stock price if they choose to cash out their profits [1][6]. Group 1: Shareholder Dynamics - The cornerstone investor, Tongzhou International Development Co., Ltd., subscribed to 9.5565 million shares, accounting for 31.39% of the total global offering, indicating strong support from Beijing's state-owned assets supervision [2][3]. - Xunzhong Communication's actual tradable shares post-listing are 17.15%, with the cornerstone investor holding a significant portion of the shares [2][3]. Group 2: Stock Performance - The stock price of Xunzhong Communication experienced volatility, initially breaking below the issue price shortly after listing, with a peak increase of 64% within ten trading days, reaching HKD 22.1 per share [4][6]. - As of December 31, the stock price was HKD 15.16, reflecting only an 11.88% increase from the issue price, indicating a "roller coaster" stock performance [6]. Group 3: Financial Performance - Xunzhong Communication's revenue from 2022 to 2024 shows steady growth, with figures of approximately RMB 8.1 billion, RMB 9.16 billion, and RMB 9.18 billion, primarily driven by CPaaS business growth [7][8]. - However, net profit is declining, with figures of RMB 75.97 million, RMB 77.62 million, and a significant drop to RMB 53.55 million in 2024, despite cost-cutting measures [8][9]. Group 4: Future Outlook - The company is transitioning to a dual-driven growth model, focusing on stable cloud communication services and high-growth intelligent communication solutions, which are expected to align well with government projects [10][12]. - The ability to maintain this new narrative will be crucial for Xunzhong Communication to reshape its value in the capital market, making it a focal point for investors [12].

Group 1 - The company plans to globally offer 30.44 million H-shares, with 3.044 million shares available for sale in Hong Kong and 27.396 million shares for international sale, along with an over-allotment option of approximately 15% [1] - The expected pricing range for the shares is between HKD 13.55 and HKD 15.15 per share, with the subscription period from June 30 to July 4, 2025, and the expected listing date on July 9, 2025 [1] - The company is the third-largest cloud communication service provider in China, holding a market share of 1.8% of the total revenue in the Chinese cloud communication service market for 2024 [2] Group 2 - The company has entered into cornerstone investment agreements, with cornerstone investors agreeing to subscribe for shares amounting to approximately HKD 131 million, assuming a mid-range offer price of HKD 14.35 per share [3] - The estimated net proceeds from the global offering are approximately HKD 391 million, which will be allocated as follows: 45.4% for service and solution development, 15.6% for expanding sales channels, 16.2% for acquisitions in China, 12.8% for repaying outstanding loans, and 10.0% for working capital and other general corporate purposes [3] - The company is one of the few in China capable of providing AI-driven communication services, with its core business being Communication Platform as a Service (CPaaS), which accounted for over 80% of its revenue during the historical period [2]

Core Viewpoint - Xunzhong Communication Technology Co., Ltd. is preparing for an IPO on the Hong Kong Stock Exchange after multiple unsuccessful attempts in other markets, indicating a strong desire for capital to support business growth and product upgrades [1][5][9]. Company Overview - Founded in 2008 by Park Seong-geun, Xunzhong Communication is a full-stack cloud communication service provider with over 25 years of experience in the IT industry [7]. - The company has undergone several rounds of investment, with major shareholders including Park Seong-geun (27.36%) and institutional investors like Lianchuang Innovation and Dongfang Huagai [7][9]. - Xunzhong primarily offers three types of solutions: Cloud Communication Services, Intelligent Communication Solutions, and Other Communication Solutions, with CPaaS being the core business [8][9]. Financial Performance - Revenue for 2022, 2023, and 2024 was approximately CNY 810 million, CNY 916 million, and CNY 918 million, respectively, showing stable but insufficient growth [9]. - Net profit decreased significantly in 2024, dropping over 30% year-on-year to CNY 50.64 million, attributed to asset impairment losses [9][10]. - The company has faced cash flow issues, with operating cash outflows for the past three years totaling CNY 117 million, CNY 56.21 million, and CNY 114 million [12][13]. Market Position - Xunzhong ranks third in China's cloud communication service market, holding a market share of 1.8% in 2024, with the overall market expected to grow from CNY 503 billion in 2024 to CNY 745 billion by 2029 [8][15]. - The competitive landscape is intense, with around 800 cloud communication service providers in China, and the top five accounting for approximately 20.9% of the market [15]. Challenges and Opportunities - The company faces challenges in maintaining profitability due to high telecom resource costs and increased accounts receivable [12][13]. - Despite these challenges, Xunzhong has opportunities in the digital economy, particularly in the tourism sector, leveraging AI technology to enhance service offerings [17][18].