Key Takeaways
Transssion has filed to list in Hong Kong, reporting its revenue fell 16% in the first half of this year as its profit plunged by more than half
The company rose to prominence by focusing on budget feature phones for emerging markets, but is facing more competition as those markets transition to smartphones
When we write about mobile phones, we tend to use the term interchangeably with smartphones, since smartphones account for nearly all mobile phones sold in mature Western markets, and even in some developing markets like China. But the reality is far different in many developing markets like Africa, where a more basic group of feature phones from a pre-smartphone era are still a dominant market force.
A focus on such basic feature phones propelled Shenzhen Transsion Holdings Co. Ltd. (688036.SZ) to global stardom over the last decade, as it profited by selling its basic models to Africa and other emerging markets. Now, the company, currently the world's fourth largest smartphone maker in terms of units sold, is hoping to dial up fresh funds with plans for a new listing in Hong Kong.
Transsion filed for its Hong Kong listing last week, following reports in July saying it was planning such an IPO to raise up to $1 billion. The new listing would complement its existing listing on China's A-share market in Shenzhen, which is mostly accessible to domestic Chinese investors. A second listing in the more globally focused Hong Kong certainly makes sense for the company, since the vast majority of its sales are outside China.
Transsion was quite the hot ticket for most of its life, growing at breakneck pace since its founding in 2013 by tapping markets neglected by other major brands, starting with Africa. But lately it's fallen on hard times as other major players, many of those also from China, start to target those markets to keep their ...
