Asian Tech Press (Nov 23) -- China's leading artificial intelligence (AI) company SenseTime Group Inc. passed the Hong Kong Stock Exchange hearing on the evening of Nov. 22, with CICC, Haitong International and HSBC as its lead underwriters. The IPO is scheduled to raise up to $2 billion, according to media reports.
According to a report by Frost & Sullivan, SenseTime is the largest artificial intelligence software company in Asia by 2020 revenue and the largest computer vision software provider in China with 11% revenue market share in 2020. As of the first six months of 2021, the company's software platform has a combined customer base of more than 2,400, while it has also empowered more than 450 million cell phones and more than 200 mobile apps.
Since its establishment, SenseTimehas published more than 600 top academic papers and held more than 8,000 AI patents. As of the first half of 2021, the company had 40 professors and over 5,000 employees, about two-thirds of scientists and engineers.
The offering said that the global market for artificial intelligence software will reach $121.8 billion in 2025, growing at a compound annual growth rate of 31.9 percent from 2020. China's computer vision software market is expected to grow at a CAGR of 43.5%, from RMB 16.7 billion in 2020 to RMB 101.7 billion in 2025.
However, the company is also exposed to risks related to international geopolitical and trade protection measures that could adversely affect its business or financial condition in the future. SenseTime was placed on the list of entities by the U.S. Department of Commerce's Bureau of Industry and Security in October 2019 to control its ability to purchase access to certain commodities, software and technology. The filing said that these supply disruptions or suspended export controls did not have a material impact on the company's business.
SenseTime's revenue is derived primarily from the sale of software platforms, including software licenses, artificial intelligence software and hardware products and related services.
The prospectus disclosed that 60% of the fundraising would be used to enhance research and development capabilities. Approximately 10% will be used to expand the company's AIDC computing power; about 10% will be used to strengthen its AI chip design capabilities and develop its own AI chip solutions; about 15% will be used to enhance capabilities related to AI models, and about 25% will be used to develop products further and improve other AI R&D capabilities to maintain industry leadership.
