On January 24, Tuhu Yangche submitted a prospectus to the Hong Kong Stock Exchange to seek listing on the Main Board, with Goldman Sachs, CICC, Bank of America Securities and UBS Group as joint sponsors.
Founded in 2011, Tuhu Car is China's leading online-offline integrated vehicle service platform, according to the prospectus. With a customer-centric model and efficient supply chain, it can provide a one-stop, fully digital, on-demand service experience, directly meet the diverse product and service needs of car owners, and create a vibrant automotive service ecosystem composed of car owners, suppliers, car service stores and other participants.
At present, Tuhu Car's service network in the country continues to expand, with more than 3,300 Tuhu workshop stores and more than 33,000 cooperative stores, covering most prefecture-level cities, and continues to expand. The business covers most passenger car models sold in China, meeting the full range of automotive service needs from tire and chassis parts replacement to car maintenance, repair, and car beauty.
According to the research of the China Insight Consulting Report, in 2020, the scale of China's auto service market (including car repair and maintenance, car wash and car beauty, and installed accessories) has reached RMB1.0 trillion, and is expected to grow at a compound annual growth rate of 10.0%, reaching RMB1.7 trillion in 2025.
Due to the high fragmentation and complexity of China's auto service market, Chinese car owners often face the dilemma of sacrificing certain service needs in exchange for meeting other service needs. These considerations include convenience, service quality, product quality and authenticity assurance, and affordability.
At the same time, China's auto service market also has the problem of overly complex supply chains. For example, each model has thousands of different parts, which are often incompatible with other models; the traditional auto parts supply chain has many levels, creating a living space for unauthorized manufacturers to produce imitation products, resulting in further mixing of the market and making it difficult for consumers to make informed decisions when choosing auto parts and suppliers.
In order to solve the key pain points facing China's auto service industry, Tuhu Has gradually built an offline network of well-managed stores and technicians from providing customers with a variety of online retail platforms for genuine automotive products with transparent prices to provide high-quality and standardized in-store services.
Tuhu also works directly with auto parts suppliers to efficiently provide owners with affordable genuine products through a strong supply chain and a nationwide logistics network, creating a vibrant automotive service ecosystem that includes car owners, suppliers, service stores and other participants.
According to public information, since its inception, Tuhu Has received a total of 16 rounds of financing, raising a total of more than 9.1 billion yuan, and many investors include Tencent, Baidu, Goldman Sachs, Hillhouse Capital, Sequoia China, CICC and other star institutions. In this IPO, Tuhu Yangche intends to raise funds for business expansion, research and development of platform systems, data analysis technologies, etc., and strengthen relations with franchisees.
According to statistics, Tuhu's car revenue has always maintained rapid growth. Revenue in the first three quarters of 2021 increased by 41.8% year-on-year (from 6 billion yuan to 8.4 billion yuan); in 2020, due to the impact of the epidemic, the company's total revenue in 2020 increased by about 24.3% year-on-year (from 7 billion yuan to 8.8 billion yuan); the company's gross profit level continued to increase.
Tuhu Car said that "making car service a kind of on-demand experience" is the original intention of enterprises to enter the market from online, and enterprises firmly believe that customer experience is the key to success, and only by creating a customer-centric online and offline integrated platform can we better serve China's auto service market and serve consumers.
Source: Hubei Daily
Editor: Chen Yuanlu
Review: Jin Luyao