The Young and the Leveraged

18 October 2017 By Alec Macfarlane

The online lender backed by e-commerce giant Alibaba’s financial arm has priced its U.S. listing above expectations, says Reuters. It boasts fast growth, low defaults and – shockingly for tech – profitability. As young Chinese shoppers rack up debt, Qudian will keep earning.

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Qudian, a Chinese online micro lender backed by e-commerce giant Alibaba’s financial affiliate, has priced its U.S. initial public offering at $24 per share, above the expected range between $19 and $22, Reuters reported on Oct. 18 citing sources.

Backed by Alibaba’s Ant Financial, Qudian lends cash to young Chinese consumers such as white collar workers, and advances credit so they can buy goods online and pay for them in monthly installments. The company provided $5.6 billion to 7 million active borrowers in the first half of 2017.

The sale of 37.5 million shares in Qudian has already raised about $900 million, making it the biggest U.S.-listing by a Chinese company this year, the report said. The offering values Qudian at as much as $7.9 billion, the report added.

Qudian’s net income rose nearly eight-fold to 973.7 million yuan ($147 million) in the six months ended June 30 compared to the same period the previous year.

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Qudian’s net income rose nearly eight-fold to 973.7 million yuan ($147 million) in the six months ended June 30 compared to the same period the previous year.

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